Everyone who starts a business wishes and believes that the business will grow, hire more people, generate more revenue, and provide long-term financial security of the business owner, yes these things could happen but do you think they just happen? You think the growth is automatic? What if I tell you that your business might as well fail in the next 5 years after you start?
I am not fortune tellers, but I know the attributes of a failing and successful business, and today we explore some of the reasons or signs that your business will fail if do not understand and take care of them.
Do you have a written business plan?
Do not tell me because you are the business owner, you know the ins and outs of your business, then why bother writing a business plan? Wrong. Every business must have a written business plan to show you how you understand your market, how you know about your customers, how do you price your products/services, how you recruit your team, how you plan for your cash flows, and how you will manage your risks. The business plan will guide you on how you transform your idea into a real business.
What is your revenue model?
Do think that open a car wash is the guarantee of earning your revenues, revenues to be earned must be planned, and most importantly, must be designed in a more competitive model, the revenue model will guide you on who you sell you, at what price, what price guarantees do you offer, what types and for how long should you offer discounts, etc.
Did you research on your business idea?
You need to understand that business ideas that can turn into a multi-billion business are limited, not every business idea you come up with can real turn out to be a success, do your market research and see whether there is a great potential for your business idea in the market, how big is your target market, how is the competition, how will you price it, position it, etc.
Are you executing what you planned?
Some people say that business success is 10% inspiration and 90% perspiration, and it doesn’t really matter which philosophy you believe in, just know that business growth and success comes execution. The major difference between a small and big business, successful and failing business, is simply EXECUTION. Having a good idea alone is unworthy without execution, if you think you are not ready for making tough decisions and taking risks, then wait for your fall.
What is your competitive edge?
Goes is the saying that “do not reinvent the wheel”, this simply means we are living in world where we cannot do different things but rather doing same things differently. If you already know about your competition, how the do you differentiate yourself from the rest? How do you package yourself differently? In other words, what is your competitive edge? If you think there is no competition in your market then think twice, it could be an indication that there is not market for your business idea.
What kind of a team do you have?
People say that business growth is about systems and structures that you build, yes that’s very true, but who is behind such systems and structure? What kind of a team have you recruited to sail the ship with you? Do they have relevant skills and experience? do they simply have what it takes?
Are you marketing yourself enough?
Doing a business without advertising is like winking at a girl in the dark, you need to come out of the shelves and tell the world what you are offering, you think you can build and grow your business just by a word of mouth? Market yourself, and today the marketing landscape has changed, from physical networking to social media
Do not underestimate the journey
Patience and perseverance will be your fare in this journey, do you think the next 5 years will be an easy ride, you will be tested and you might feel like giving in, business growth has never been an easy ride. Studies show that most entrepreneurs get tired on the way, give up, and close down the business.
In a conclusion, know that starting, building, and growing a business requires more than just a good business idea, learn about all of the above, work on them, and will see you in 5 years time, if you started your business 2 years ago, you are left with 3 years down the road.
About The Author
Salum Awadh is a renowned business and financial consultant in Tanzania with about eight (8) years of experience in providing advisory services in the areas of business development, management, finance, investment, transaction advises, venture capital, deal structuring, project management, risk management, socio-economic development, research and training. He holds an MBA (Finance) and currently doing a certification in Chartered International Investment Analyst (CIIA)