Entrepreneurs in setting up their business often seek to
enter the arena with a bang, to create an image all in the name of “Branding”
or doing something different to set them aside from the rest. The expectations and zeal are so high, the
adrenalin is pumping, and dreams are high but with low budget. Most of the
time, the limited resources are expended on non-income generating activities
and assets with the high expectation that income will start rolling from day 1.
Optimism is good but should be well guided with the realities
on ground. Most of businesses tend to fail before it actually starts; by the
time the owners realize that all the expectations are not being met. Businesses
are not coming in as expected, revenues are not been generated, operating cost/expenses
had to be met; working capital is fast depleting, etc.
From the experience and discussions with some clients, the
following 7 key mistake areas amongst others are common:
1. High Set up cost: It is understandable that every new Entrepreneur wants a
good office in a good location with lovely ambience, furnishing, etc. but it
all cost money though compulsory. What purpose will it serve to spend the bulk
of your budget on securing a beautiful and well-furnished office space without
the necessary clientele base to service it or the working capital to run it?
Note that people will do business with you not because of your office but what
you have to offer. The focus should be accessibility, neat environment and
sufficient parking space.
2. Inadequate/poor staffing: we all have the picture of the structure we want to
implement when we start our businesses. Never allow sentiments to dictate or
determine who to engage. At first, essential staff should be employed and as
the business grows, the staff strength can also be increased. Recruiting the
wrong staff or number can damage the fragile structure you are trying to build.
Remember, whether you make sales or not, the staff must b paid!
3. Lack of Product/Services knowledge: Know your product and services
which must be to either solve a perceived problem/challenge or meet a need.
Don’t start a business because a friend is into it and he is making money. You
must have the experience and have passion for it. You should be your own
customer and ask yourself, can I buy this if I am a client? Be focused.
4. Failure to Delegate: You cannot do everything nor know everything. Assign tasks
to your staff not only to develop them but to create the opportunity for you to
focus your energy and time on developing and growing the business. Give the
staff the chance to earn his/her pay. Other experts in certain fields can also
contracted to relief you of some burdens. Take time to choose your team, people
that complement and not contrast you.
5. Lack of Market and Competitor knowledge: knowledge is wealth. Know your
market, its operations and the demand of the target customers. Align your
processes, products and services to their needs or to solve a problem. The era
where products are made and forced down the throat of people vide
advertisement, etc. are long gone.
6. Unwillingness to seek help: in life, no one is an island and none has the
monopoly of knowledge. Seek help from those that are well experienced and
knowledgeable in the areas where you have challenges. Problem shared is already
half solved.
7. Lack of plan: It provides a guide and a means of measuring performances
and ascertaining deviations from the standard. Problems can be identified and
tackled early and deviations corrected. Put in place a proves to save yourself
time, energy and money
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