Everyday, new business are given birth to and everyday businesses are folding up. Why are businesses folding up everyday? Well the answer to that question is what am about to give to you, so sit back as we journey on the quest for success in business.
There are many problems that destroy a business and this problems can be caused by 2 factors.
- External factor
- Internal factor
The external factors include insecurity, poor electricity supply, lack of good regulations, high cost of tax, transportation issues, competition. Since the external factor affects all businesses, I won't go into details about it. What I want to talk about is the internal factor since it doesn't affect all business.
Internal factor can include poor strategy, lack of financial know-how, little or no quality staff, lack of good structure, unclear plan and so on.
The first lion (problem) - lack of good accounting knowledge :
6 out of 10 business I owners cannot account for their fund. They do not separate business funds from personal funds. Accountability is the key in business. If you cannot manage your funds properly, then the business funds would soon fold up. If you are going to prevent this lion, you have to be accountable.
The second lion (problem) - little or no quality staff : since it is hard for owners of small business to pay a good salary, they find it hard to employ good staffs. Most business owners do not have plans for their staff. They don't have staff manuals that gives the benefits of a staff, when they are due to be promoted, increase in wage, vacation and appraisal.
As a result, it is difficult to get the loyalty of staffs because staffs feel that the small business owner are using them to make money and enrich their family.
The third lion (problem) - lack of good strategy : strategy is the set of actions that business owners take to help him achieve is business objectives. When you see a successful business man, it is not because he has access to funds, but because he has a good strategy.
A good business owner must be able to answer these questions
- how do you want to launch your business?
- how do you intend to deliver?
- how do you satisfy your customer?
The fourth lion (problem) - Poor structure : small business owners rarely have a profitable operating structure. If one of your core values is effectiveness and your structure does not support effectiveness in your business, then there is a problem. Your customers may loose interest in you and may go for the alternative.
The fifth lion (problem) - lack of financial know how : Many business remain at the small level because the owner lacks the knowledge to take the business to the next level. Most business owners feel that all they need to do is to get some money and start the business but they lack the knowledge that is required to enlarge their operations. Most business owners do not understand the dynamics of managing a business, they are only familiar with the technicality of the business. When people have access to money, the lack of financial knowledge makes them to take the wrong decision.
Now pick up your sword and face those lions.
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