Why small businesses fail: Part II

28 Jan, 2023 - 00:01 0 Views
Why small businesses fail: Part II Do more of what works, and avoid what does not work.

The Herald

Arthur Marara-Point Blank

IN the last instalment we commenced a conversation on why small businesses fail. 

While the talk is so much on “small businesses”, the truth on the ground is that there is no business that is too big or too small to fail.

 Any business can fail! During Covid-19 several big businesses folded. 

No one is safe in the world of business.

This is why the conversations must be on continuous learning.

Learn what works and what does not work.

Do more of what works, and avoid what does not work.

This week we are going to finish off the discussion on why small businesses fail.

If you missed the first part, you can always get it on the Business Weekly Website.

Not keeping abreast of customer needs or the competition

Building a loyal customer base requires knowing who your target customers are and how you can connect with them.

But it is also important that you have the measures in place to stay on top of what your customer needs are. 

If you fail to understand what your customers expect from you (through customer feedback surveys, monitoring and responding to comments on your social media business pages, and simply talking to your customers) you risk losing those loyal customers to your competitors.

Speaking of competitors, you also need to keep track of what your competitors are up to – because if they do a better job of fulfilling your customers’ needs, you will lose business to them.

Failing to adapt

During the press conference to announce Nokia being acquired by Microsoft, the CEO ended his speech saying this “we did not do anything wrong, but somehow, we lost”.

Upon saying that, all his management team, himself included, teared sadly.

Nokia has been a respectable company. They did not do anything wrong in their business, however, the world changed too fast.

Their opponents were too powerful.

They missed out on learning, they missed out on changing, and thus they lost the opportunity at hand to make it big.

Not only did they miss the opportunity to earn big money, they lost their chance of survival.

The message of this story is, if you do not change, you shall be removed from the competition.

It is not wrong if you do not want to learn new things.

However, if your thoughts and mind-set cannot catch up with time, you will be eliminated.

The advantage you have yesterday, will be replaced by the trends of tomorrow.

You do not have to do anything wrong, as long as your competitors catch the wave and do it right, you can lose out and fail.

To change and improve yourself is giving yourself a second chance. To be forced by others to change, is like being discarded.

Those who refuse to learn and improve, will definitely one day become redundant and not relevant to the industry.

They will learn the lesson in a hard and expensive way.

Bear in mind that in business just like in life things do not always go to plan.

Whether it is responding to changing trends within your industry, unexpected events (like the Covid-19 pandemic or natural disasters), the impact of broader economic issues (such as changes to interest rates, government policies), or even changes to your personal situation (due to illness or other challenges), it is inevitable that your business will face challenges along the way.

Stay accustomed to what is happening inside and outside your business and be ready to respond – quickly! That is adaptation.

Growing too quickly

Who does not like growth? Everyone loves it, in fact that is the dream of every entrepreneur to see their business grow.

However, success can be fatal if you are not actually prepared for it.

One of the things you need to constantly ask yourself is whether or not you are ready for growth.

Growth is one thing, but managing it is another. Not being prepared for your own success can also be a reason to fail.

You need thorough knowledge and readiness on knowing what you will need – for example, in terms of staffing, technology, business funding, supply chain management – to be prepared for your future growth plans.

Do not attempt to grow or expand your business quickly. This may choke you and end up destroying everything that you even worked for.

Failing to hire and retain the right people

You cannot achieve your business goals on your own. You need the right team to work with.

As an organisation you need to focus on hiring and retaining the right people. In short, right people, right positions.

This may sound simple but this is the reason why some big organisations are suffering.

They cannot even grow at all.

Establish a diverse team with complementary skill sets, the right attitude and values aligned with your business from the start.

This will help you in the long run. Attract the right people, and also create a work culture and atmosphere that makes them want to stay.

Not asking for support

Entrepreneurship can be a lonely journey. It is not everyone who is going to believe in you from the onset.

The number of challenges there are to overcome when commencing your business can be both exhilarating and terrifying. 

Without the right support a number of business owners feel alone, overwhelmed or on the verge of losing focus and giving up.

Do not go through this journey alone. You can ask for help. 

This journey requires you to have a business mentor to walk with.

Talk to the professionals in your network on the help that you need and the available options.

Ultimately, whether a business fails or succeeds is heavily influenced by its management capability.

Develop your leadership capacity. John C Maxwell once noted, “everything rises and falls on leadership.”

The more you develop yourself as a leader, the more business actually grows. 

Arthur Marara is a corporate law attorney, keynote speaker, corporate and personal branding speaker commanding the stage with his delightful humour, raw energy, and wealth of life experiences. He is a financial wellness expert and is passionate about addressing the issues of wellness, strategy and personal and professional development. 

Arthur is the author of “Toys for Adults”; a thought provoking book on entrepreneurship, and “No one is Coming”; a book that seeks to equip leaders to take charge. 

Feedback:[email protected] or Visit his websitewww.arthurmarara.com or WhatsApp: +263780055152 or call +263772467255.

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