Contributor: Mr. Panache
The truths about real business.
While this is the best thing to do in one’s lifetime, business can be a big challenge for many entrepreneurs and maintaining it is even a bigger challenge. As the business starts, it has to cater to certain needs without cash reserves and clientele, and as it grows, different other problems and opportunities emerge demanding solutions.
The strategies are probably different as you striving to sustain the business for dear life, honour bills and provide for yourself or family. Much of efforts would be directed at finding clients to secure constant income, establish the brand and make adjustments to match competition.
When the business is in its growth stage, depending on how well receptive the industry has been to the business, it would have made some of its own capital, made contacts and networked adequately for future recommendations.
Even with experienced entrepreneurs, sentiments are that problems seem unique every time they emerge, especially when they are difficult to overcome. Parting ways with all things and everything dear to one’s heart, either possessions or cherished relationships in pursuit of something unpredictable is the usual life of an entrepreneur. One can never get used to business because the challenges it presents may vary, and imagine now having to quit your day job to make establishing your own concern work.
Challenges may seem obvious because of the similarities in scenarios, but they can never be underestimated.
Others may see these challenges as rewarding but nonetheless, they are stressing too. With all the uncertainties and compelling pressures that comes with being in business, it still a thrilling experience that requires an informed and open mind. There are hundreds of reasons as to why business fail and out of all, we opine that the following four are potential hardships known to be the usual causes of business failures in this era:
a) Cash Float and Reserves Problems. It is usually never clear when the business might land in trouble either with the law, responses from the environments, political forces, honouring bills and more. Unless, a business has been existing for a while with built up clientele and pool of capital, before the business starts making the much needed money, prospects are very poor that it will succeed. At any moment in the process of running your own business, sufficient cash is required and that can provide the business with the flexibility. Since a business cannot fully depend of sales, which have been accounted for, an entrepreneur needs to always remember that clients sometime pay slowly and this can make it harder for the owner of a business to build reserves.
b) Passionately Trudging the Business Uphill. “Character consists of what you do on third and fourth tries.” – James A. Michener. Believing in something that is unpredictable is not an easy task. As know half the time, with small businesses it is usually the employee who notices a sinking ship because the owner still has the belief. Honestly, that is the absolute passion required of entrepreneurs to succeed in business and really the agility to persist even when there are no funds. Entrepreneurs often hit the hard times, making mistakes like anyone in pursuit of anything great and when that happens, they would have learnt a great lesson. Business is not for the fainthearted, needs the heart of as warrior, monies coming in can be inconsistent and can subject the owner to the long haul.
c) Poor Planning and Management. Much like the document itself, planning as a management process is one of the most important aspects of running a business and concerned with the defined goals and objectives, future of the concept and allocation of resources to meet the desires. Having a plan ready can help a business evolve from where it is through to succession, providing guidelines and necessary recourse when things are not turning out as desired. Think of having a plan as having a laid foundation and a complementary design of the structures built on that foundation, other than taking off on a journey to an unknown destination and not knowing what you even carrying.
d) Failure to Correctly Price Good/Services. When a business has a clear and bankable concept, it can easily chose whether it subscribes to being a price setter of price taker and if not handled properly it can affect the business in both the short and long-term. Remember, the business always needs capital as long as its doors are still open and if so much of sales are generated only to return monies invested without profits, this can kill a business. Might seem as though the business is making money when it is only make revenue but not profits. Not everyone has the experience, but information is readily available on public domain for strategies and methodologies when setting prices on products and services, and only requires research. No entrepreneur wishes anything disastrous on their own business, but incorrectly putting priority on products and services by not setting prices in the best interest of the business will, at best, limit the growth of the business.