By James Jorner
When you decide to start a business, you have two goals in mind: to solve a problem and to make profit. But these two things are not as easy as they usually sound. If they were, every building you pass by each day would be a successful business. There are stages businesses go through, and each passage of time determines where your business is headed. If a business is bound to succeed, the first six month should be enough to get a faint signal of it. But, unfortunately, most businesses don’t make it past the first half of their one year anniversary.
Reason #1: They solve no real problem If one of the main goals of a business is to solve problems, then it’s very important to know what type of problems you want to solve. Most people found their business after only coming up with an ill-thought idea on how to solve an irrelevant or non-existing problem. After a few months, usually building up to the first six months of starting the business, they then realize that they are not truly solving any problem. This is when they begin to look elsewhere. Before you beat you hand on your chest in front of potential investors, sit down and think about the type of problem you’re about to solve. Is it truly a “real problem”? If it’s not, the best time to know is now before it becomes too late.
Reason #2: Being too profit-conscious When a business is all concerned about making profit and enriching its founders, such business won’t last the first six month. The reason is because the business is either going to be charging in excess of the market rate and customers will start deserting your business gradually. Most businesses don’t realize profit during this period. This is a period where a lot of businesses run on their personal funds and recoup whatever they’ve lost in later months or years as the case may be. Being too profit-conscious will also prevent a business from giving the best to serve its customers, thus impacting the quality of its output in a negative way.
Reason #3: Bad Management A business can only be as strong as its management. Finding the right brain to manage a business can be hard, but failing to do so translates that the business is heading the wrong way. There are several factors a leader must possess to be able to manage a business right, and one of them is experience. Someone who has prior experience working in a similar position has a greater chance of leading the business to success than the one with no prior experience.
Reason #4: Procrastination This also affects businesses really bad. In fact it hurts businesses more than it does an individual. If there is something important for your business to implement, make sure you do it on time. While it is important to think things over before making a final decision, especially when it affects other people, it’s more important to always make up your mind on time.
Reason #5: Focusing on Your Competition At this stage, I stand the risk of sounding controversial, but focusing on competition is a major contributing factor to killing a business. Aside the fact that you’ll get distracted along the way, you also stand the risk of eventually being another copy of your competition. Stop the fuzz about your competition and focus on how to improve your services and products. This way, you’ll be able to build a great business that will last forever.
What other reasons do you think some businesses fail in the first six months of starting them? Share your ideas with us or tweet @Africwomenpower.