Top 5 Pitfalls of Entrepreneurship
Starting a business can be tricky and in most cases disastrous if one doesn’t know what they are doing. It is no wonder that so many businesses collapse within the first five years or less, but the good news is that a lot more companies have succeeded nonetheless. If anyone wants to start their own business, here are some of the biggest problems they will come across and how to solve them;
- Cash Flow problems
Most new entrepreneurs start a business without a good plan in hand, so they only have capital and no operating money. Every business requires money whether it’s to pay employees, transport, bills, taxes, and others. Unfortunately, clients may take their sweet time to pay up leaving you with a load of debts. When starting the business, one must consider everything they will need to do for a few months before the business breaks even or becomes stable. It’s important to have some savings, supportive people around and good relationships with suppliers and other stakeholders. One can also try to request for short invoice period like 15 days so that the waiting period is not too long.
- Internal strife
A lot of people who start a business together do so for the wrong reasons; either they are friends, cousins or classmates. Down the line, if their dreams and visions change; there is bound to be strife that can only lead to the collapse of the business. Business partners should be people who have the same vision. It’s important for them to have sober minds and not put emotions into the business because the good of the many outweighs the good of one.
- Over-Ambition
No business started as a Fortune 500 Company no matter who the owner is. Many people want to start a big million dollar business from day one even when they don’t have money. Over -ambition leads to borrowing, taking up more than they can handle, and making a lot of mistakes. God forbid the business doesn’t work out; they will have lost a lot of money and be left in terrible debts. The best way to start a successful business is to start small with whatever someone has and avoid borrowing at whatever cost. Even if it means working from home where he is the driver, receptionist, and MD; seeing a startup grow slowly from scratch is very rewarding, and the owner will be able to see everything that they have done every day.
- Finding Customers
Every startup goes through the period where there are great products or services, but nobody knows about it. Gaining customers is a gradual process that requires hard work and patience, and it can even take months to get regular clients. It takes time for business to grow and become stable. The entrepreneur should start telling people about the products and services before the launch of the business. Marketing is the biggest component in every business, and it has to be ongoing every single day. If they can’t afford to hire a marketing team; word of mouth, social media, newspapers and media should be utilized but most of all, the product must be extemporary and unique. If the product is excellent, one customer will tell another one, and the chain will continue until there are too many people to serve.
- Self-Doubt
After facing all the above problems from lack of resources, customers and individuals are quitting; it’s common to feel like a failure and think that it was not a good idea to start the business. It is at this point that most people decide to count their losses and pack up instead of pushing through. The best thing anyone can do in life and business is to have support regarding mentors, family, and friends who will not let them give up. A mentor has probably gone through the same challenges, so they know how to overcome them while other supporters cheer on with prayers, finances, and marketing.
Conclusion
Being a business owner takes courage, hard work, and sacrifice because there is no assurance of the next paycheck like in employment. One must put everything they got from time to money in the startup business for it to be successful but most of all they need someone to guide and encourage them through the pitfalls.