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Complete 3 pages APA formatted article: Legal, Social, and Economic Environments of Business.
Complete 3 pages APA formatted article: Legal, Social, and Economic Environments of Business. Despite small businesses enjoying a wide range of advantages over their large business counterparts like lower initial costs, flexibility in terms of operations and maximization of the few niche of customers that they handle, there are still several issues and challenges surrounding the handling of such businesses if not just a few that they have to contend with and manage. The issues revolve around finances of such organizations, management problems including wrangles in leadership and employee issues (Associates &. Granville, 1989). The simple survey I carried out revealed to me a gist that many small businesses are at the dire risk of being bankrupt, this majorly arises due to the fact that most small businesses do not have at their disposal a wide range of financial sources to get money (Associates &. Granville, 1989).
Undercapitalization has also been highly attributed to poor planning and management of the few resources that are at their disposal, in our case there are very creative innovations without financiers. This is also largely attributed to the fact that a private businessperson has access to all the finances of the business and may not be in possession of all the knowledge to manage the resources (Hisrich, 2004). Another contributor to the financial challenges is the fact that small businesses all financial liability finally rests on a single person who becomes liable to all business debts in case of liability hence financial burden.
Apart from undercapitalization, most small businesses suffer businesses also suffer problems of general mismanagement due to lack of skills by their owners who act as the central managers to the businesses (Hisrich, 2004).
