- June 25, 2021
- Posted by: Temitayo Omodehin
- Category: Business plans, Consultation, Economics, Finance & accounting
When it comes to running a business, you have to identify factors critical to your success. Proper structure, decision-making, and planning are all markers of a successful business. It is often the case that new and intending business owners underestimate the difficulty of starting/running a business. According to data from the U.S Bureau of Labor Statistics, about 20% of small businesses fail within the first year. By the end of their fifth year, roughly 50% have folded up. There are many reasons why a company might fail, but perhaps the most significant is the business owner.
Here are five signs you shouldn’t start a business.
You’re desperate for money.
Don’t start a business to get rich. This is the number one mistake people make. People who start a business just for the sake of money often fail. They usually fall for get-rich schemes, are more liable to take poorly calculated risks, and make unethical and immoral decisions. Any venture aims to generate revenue. However, profit is a by-product of value creation. A business owner should focus on creating and building value. Money will come after.
You can’t close sales.
No matter what industry you’re in, the ability to close deals is crucial. Those that quickly close deals will be able to sell more than those who drag their feet. If you’re unable to complete contracts or sell reliably, your business is bound to fail. You may have a fantastic product or service, but your business may be dead on arrival if you cannot convert products to sales.
You don’t understand the industry.
Many people impulsively get into a business because they’ve seen it work for someone else. Rushing into a business without proper knowledge is financial suicide. You should know the ins and outs of a business model before you start. An in-depth understanding of the market, expenses, competitors, etc., is a prerequisite for running a successful business.
You think you’ll succeed in less than one year.
A good idea isn’t everything. A lot of new business owners assume their business will take off overnight to become an instant success. They presume, poorly, that it’ll be smooth sailing and a bed of roses. Entrepreneurship means being able to deal with uncertainty. You have to be prepared for challenges ahead of time. Be prepared for setbacks and even failure. When things go wrong, which they inevitably will, you will be adequately positioned to deal with and learn from them.
You’re not willing to dedicate years of your life.
Rome wasn’t built in a day. A pillar of entrepreneurship is delayed gratification. If you’re serious about starting a business, you have to contend with the reality that it will take time. If you aren’t willing to invest years to see your seed germinate and grow, starting a business is not for you. There is a process that must be followed. We admire successful entrepreneurs as if they knew they would succeed from the beginning. This is not the case. Their success only came after years of hard work and dedication.
In the world of entrepreneurship and business ownership, success and failure are common. There may not be a one size fits all formula for success. However, some principles can better position you for success.
Passion will sustain you in periods of uncertainty. It will drive you to seek ways to improve your business constantly. It is the fuel in your engine that will keep your business running.
Discipline is vital for business owners. Self-discipline will allow you to take measured steps in your business. It will also enable you to respond better to the highs and lows of business life.
Business owners constantly have to make decisions; decisions about the what, when, why of the business. A good entrepreneur must be able to make timely, thought-out decisions.
Obviously, there’s no single person who meets all of these criteria, at least not at first. We aren’t saying that you have to be perfect to start a business – only that you need to understand how much work really goes into launching a company.
If you can be honest about your weaknesses and take the necessary steps to address them, you’ll find that all of this effort will be worth it in the end.
Learn effective strategies for starting and running a business. Contact Catalyst Business Consult today on +234 816 272 6997