Has it ever crossed your mind why some new businesses fail few months after they hit the arena in Nigeria? Such answers shouldn’t be farfetched as we sometimes neglect to carry out the required research before commencing.
It is ideal to consult the opinions of those in a particular business line to develop realistic details that will help you understand the necessary steps to take when starting a trade.
Nigeria is a country where numerous trades exist. Still, one major challenge is that while it may be rewarding to progress in the craft, the enabling environment for small businesses to succeed is limited.
Besides, just as mentioned in an earlier paragraph, several factors can cause a trade to collapse, especially when it lacks proper research for a profitable market.
And sometimes, while passion for the trade may not be enough to keep the business afloat, it will surely fail if you don’t also consider getting the best position or locations. The idea here is to locate the company in a place where there are regular demands for the supply/delivery of products and services.
Reasons New Businesses Fail
Some of the reasons new businesses fail in a country like Nigeria, where encouragement and enablement are low, denying the entrepreneur from going on with his/her innovative idea. But other factors could contribute to the downfall of an upcoming trade. First is:
. Zero Consultations:
Regarding consultations, ensure it makes the first step you take once the idea of starting a business pops up in your head. No one is an island, by relating with people that have been in that area. For startups, it doesn’t necessarily matter how knowledgeable you think you are. While there are many possibilities for the business idea to materialise from your input, the percentage of it thriving may depend on you seeking Advice from suitable sources.
If you fail to plan, you plan to fail; the same rule applies to you not consulting because all your available data would be based on assumptions—no harm in watching business news to understand the market and how it works.
Most starters go into business for the wrong reasons. The fact is that whatever reason makes you comfortable, then go with the flow. But there might be consequences if the sole reason is not centred on solving problems. It is advisable for an entrepreneur to commence first by identifying issues in and around an environment.
The next step would be to rally around searching for business-related solutions, one that would resolve people’s problems and generate profit in the process. Your motive is part of the early stages considerations before physically installing the needed infrastructure to progress the business.
Poor Business Administration:
To oversee a business takes serious dedication. Without paying the proper amount of attention to your trade, especially when as it’s newly springing, you are highly likely going to fail.
It takes the sacrifice of quality time to see a business grow. Distraction is not permitted in this scenario as it may cost you a heavy loss. Once you have succeeded in mounting your structure, ensure management is top-notch because anything short of what we’ve discussed about committing time and resources would be detrimental.
This made the list of discussions mentioned earlier in this written piece. An inactive location, which is also dependent on the nature of the business, has the ability to collapse a firm with heavy investment. Once the site is not accessible to your prospective customers, mainly when it has to do with purchasing products, it is easy for them to patronise an alternative seller whose stall is situated in an accessible area.
Although getting a perfect location might be difficult and expensive, the best thing to do before reaching this stage is to raise enough capital to aid you in purchasing or renting a suitable site. A good location has a massive impact on the level of patronage your business would receive, so try and avoid settling in the wrong place.
Other reasons why new businesses fail could be the lack of sufficient capital at the starting point. Also, the unrealistic expectations regarding the inflow of revenues might easily affect the entrepreneur’s morale because the profit target doesn’t come to fruition.
Make no mistake to conclude that the aforementioned reasons for failed trades are the only existing ones. There are several other factors that we at everyevery.ng are pledging your indulgence to list at the comment section. You and I know it would serve as a guide to a naive person hoping to own his/her business.