The Five Biggest Barriers to Starting a Business in the US

If you are planning to start a business in the United States, it’s important to consider the obstacles that might get in your way. Some of these impediments are not immediately obvious, but if you recognize them from the beginning, they may be easier to plan for and avoid.

Legal Barriers

Before opening a business in the United States, proprietors must jump many legal hurdles, including:

  • Zoning restrictions
  • Licensing and training requirements
  • Restrictions on the legality of the business
  • Protection of crucial business processes by copyrights and patents

  • Special legal regulations, such as ingredient labeling for food products


One of the most obvious barriers to entry is too much competition from large chains with low overhead and deep pockets. If there is too much competition, your prices are pushed lower and your profit margin shrinks. Oddly enough, there is also such a thing as too little competition. If you are introducing a new service and you have no competitors, consider the possibility that you will have to build product awareness.

Lack of Funding

It’s a classic Catch-22: you can’t get a business loan until you prove that you can make money, but it’s hard to prove yourself until you have the capital to give it a try. For this reason, many business owners find themselves dipping into their own savings to get started, or turning to friends and relatives for an initial investment.

Lack of Physical Capital

In addition to an overall lack of funding, it may be difficult or expensive to acquire some of the tools of your trade. This is particularly true for entrepreneurs who will need a workshop full of costly equipment, such as a furniture maker who needs a woodshop. In addition, building codes and food safety inspectors may require you to upgrade your work space in order to protect the safety of your workers and your customers. Your liability insurance company may also require additional safety measures.

Lack of Resources

Sometimes it’s not a lack of money that kills a small business, but another lack of resources. If you are working a second job or caring for a family, you might not have enough time to devote to your business. You’ll also need emotional support from your family, especially your spouse. In addition, you should consider the resources that your city has to offer. Are there enough qualified workers in the area to staff your company? Is the shipping and transportation infrastructure adequate?

As you consider whether to start your business, consider whether you have the passion and the resources to overcome the obstacles. If nothing else, it will prepare you for the worst.

When she’s not organizing parties, Louise Baker writes about online colleges at Zen College Life. She recently looked at where to get the best court stenographer degree.

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