A great article in this month's Entrepreneur SA magazine has inspired this post. We desperately need new business startups in this country that will have a greater chance of success. Avoid some of these pitfalls if this is you:
Wrong reasons to start a business: 1) To become wealthy. 2) Job creation 3) Freedom
The main reason to start a business should be to fulfil a need in the marketplace. Better still, to fulfil a need that will evolve in the future, filling a niche that others haven't found yet. And your business should adapt and change as the market moves on too.
A key to success is having the right financial controls in place. "Any enterprise is built by wise planning, becomes strong through common sense, and profits wonderfully by keeping abreast of the facts" Proverbs 24:3-4
You need to know exactly where you stand at all times, keeping your finger on the pulse of things. Poor credit arrangements, lack of financial planning, unnecessary overheads, insufficient reserve funds or cashflow are amongst main reasons business startups fail. Don't use your new business profits like a piggy bank to splurge on luxuries. Decide on a monthly salary and don't go over that.
Be realistic, under-promise and over-deliver. Too many startup businesses make promises they can never make good on. Don't take on an order that is so fantastic there is no way you'd ever fill it. If you can realistically produce 10,000 units, then you need to turn down an order for 100,000 until your capacity for the production is there. Or ask for an extended time period to deliver that will fit your production capacity.
Keep it simple, stay focused, and get the right people for the job. If you pay attention to all these things, your business will have a better chance of success.
For more on the Article that inspired this Post, see Entrepreneur SA.
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