Running a small business can be incredibly rewarding. You get to shape your company’s vision, build your own team, and (hopefully) enjoy the freedom that comes with being your own boss. But let’s be honest—being a business owner also means making tough decisions that can keep you up at night, wondering if you’ve made the right call.
Here’s the reality: avoiding tough decisions doesn’t make them disappear. In fact, putting them off usually makes things worse. The good news? With the right approach, you can tackle even the hardest choices with clarity and confidence—and set your business up for long-term success.
Let’s break down five of the toughest decisions small business owners face, and how to handle them with integrity and purpose.
- Letting Go of Employees
No one starts a business dreaming of firing people. But sometimes, letting someone go is unavoidable—whether it’s due to financial pressures, underperformance, or a shift in company direction. It’s never easy, and it can feel deeply personal, even when it isn’t.
The key is to make this decision only after you’ve done everything possible to help your employee succeed. That means offering training, mentorship, and support. If you’ve given them every chance and things still aren’t working, it’s time to act.
Golden rule: Be clear, kind, and professional. Don’t drag out the conversation—stick to the facts and handle it with respect. If you can, offer support for their transition. Keeping an underperforming or disengaged employee hurts your business and drags down team morale. They’re never pleasant, but they are opportunities to grow as a leader and build a stronger business.
- Dealing with Difficult or Unprofessional Clients
We’ve all had that one client—the one who never pays on time, disrespects your team, or always wants more than what was agreed. It can be tempting to keep them on board because, let’s face it, revenue is revenue. But here’s the truth: a bad client can do more harm than good.
Problem clients drain your energy, waste your time, and can even damage your reputation. If someone is consistently causing issues, it might be time to let them go. But don’t burn bridges. Communicate your reasons clearly and, if possible, refer them to someone else who might be a better fit. The goal is to part ways with dignity—for both of you.
Letting go of a toxic client frees up your time and energy to focus on the clients who truly value your work. Remember, not every dollar is worth chasing.
- Deciding Whether to Expand
Growth is exciting, but it comes with risk. Expanding too soon can stretch your resources thin, while waiting too long can mean missed opportunities. So, how do you know when it’s the right time to take the leap?
Start by asking yourself: Why do I want to expand? If your answer is vague—like “because it feels like the next step”—it’s time to slow down and get clear. Expansion should be backed by strong demand, solid financials, and a clear strategy.
If your current operations are already under strain, adding more pressure won’t fix things—it’ll only make them worse. As I discuss in mhy book $20K to 2 Million in 2 Years, growth should be intentional, not accidental. Take the time to review your numbers, talk to your team, and map out a plan before making any big moves.
- Outsourcing vs Keeping It In-House
Should you outsource a task or keep it in-house? This decision comes up time and again for small business owners. The answer depends on your goals, budget, and the nature of the work.
Outsourcing can be a game-changer for areas like accounting, IT, or marketing—tasks that require specialised knowledge but don’t demand your full-time attention. On the other hand, keeping things in-house gives you more control, faster response times, and a closer connection to your customers.
Here’s a simple rule of thumb: if the function is core to your business—like product development or customer service—keep it in-house. If it’s a secondary task that eats up time without directly generating revenue, outsourcing might be the smarter move.
Take time to review your team’s strengths and weaknesses. Sometimes, outsourcing frees you up to focus on what you do best—and that’s where your business will really grow.
- Making Decisions During a Crisis or Economic Downturn
If there’s one constant in business, it’s uncertainty. Economic downturns, unexpected expenses, and global crises can disrupt even the best-laid plans. When this happens, decision-making becomes more critical than ever.
The key is to stay calm, focus on what you can control, and act strategically. When the pandemic hit, businesses that adapted quickly—pivoting to digital services, cutting unnecessary costs, and communicating transparently—were better positioned to survive than those that froze, hoping things would improve on their own.
Crises are temporary, but how you handle them can shape your business for years to come. Be proactive, communicate openly with your team, and don’t be afraid to make tough calls if it means protecting your business’s future.
How to Make Tough Decisions with Confidence
Tough decisions are part of the job description for business owners. Here are a few practical tips to help you navigate them:
- Get the facts: Don’t rely on gut feeling alone. Gather the data you need to make an informed decision.
- Consult your team: Sometimes, the best insights come from those closest to the problem.
- Seek outside advice: A mentor or business coach can offer a fresh perspective and help you weigh your options.
- Act decisively: Avoiding a decision rarely makes things better. Once you’ve made your choice, act with confidence.
- Reflect and learn: Every tough decision is a chance to learn and improve for next time.
Final Thoughts: Leadership Means Facing the Hard Calls
Running a small business isn’t just about celebrating wins. It’s about having the courage to make the hard calls—whether that’s letting go of a team member, dropping a difficult client, deciding to expand, outsourcing, or steering through a crisis. These moments define you as a leader.
If you’re facing a tough decision, don’t go it alone. Reach out for support—whether it’s a trusted mentor, your accountant, or a business coach. And remember, clear and confident decision-making will not only help you sleep better at night, but also set your business up for long-term success.
For more practical strategies on overcoming business challenges and growing with confidence, check out $20K to 2 Million in 2 Years.
Remember, leadership isn’t just about growth—it’s about having the courage to do what’s right for your business and your team.
FAQs: Making Tough Decisions in Small Business
How do I know when it’s time to let someone go?
If you’ve provided support, training, and clear feedback, but performance hasn’t improved, it may be time to act. Delaying only hurts your business and the rest of your team.
Should I fire a difficult client?
If a client consistently causes issues, drains your energy, or damages your reputation, it’s worth considering. Always part ways professionally.
How do I decide whether to expand?
Expansion should be based on clear demand, strong financials, and a solid plan—not just a gut feeling.
Is outsourcing right for my business?
Outsource tasks that are not core to your business or that require specialised expertise. Keep critical functions in-house.
How do I make decisions during a crisis?
Stay calm, focus on what you can control, communicate openly, and act strategically. Don’t let fear or uncertainty paralyse you.
