Regardless of the Nationâ€™s Economy, failure of small businesses is a result of Inadequate and the lack of management skills and also lack of proper capitalisation of all Above., As a business owner, you must remember these Quote By â€“ Boune T. Pickens. Jr.
â€œThere are no disasters in business that you canâ€™t avoid if you see them coming and make the adjustments,
In this article, I share my thoughts on this ugly trend with four of the biggest reasons why most Small business fails in Nigeria.
Zero Managerial Skill
One of the most important aspects of succeeding in a small business is the managerial skill. This is why it is one the reasons why many small businesses fail.
When an entrepreneur lacks the ability to manage human and material resources at his disposal, then failure becomes inevitable.
An entrepreneur must be able to manage the employees, cash flow, production line and other aspects of the business. In the event that he canâ€™t handle all of this, he should hire a good manager to do that for him.
Wrong Business Decisions
â€œBefore making an important decision, get as much as you can of the best information available and review it carefully, analyse it and draw up worst case scenarios.
Add up the plus or minus factors, discuss it with your team and do what your guts tell you to do.â€
Many small businesses in Nigeria fail because of the very many wrong decisions made by their owners. Be careful and tactical with your decisions.
Wrong decisions lead to wrong investment, wrong loan collection, wrong employees and so many other wrong things.
Uncertain Government Policies
Unfortunately, this cannot be avoided. The government will always make policies that will affect you positively or negatively.
You have to be ready for emergency situations. Your exit strategy has to be tight. It is not usually easy but donâ€™t let it be the end as many people do.
Your corporate reflexes are measured by how fast and well you respond to emergency situations.
Insufficient capital is another reason why many small businesses fail. It is the duty of the business owner to always provide the capital needed for the small business.
In a case where you have insufficient capital and the business is finding it difficult to access funds from bank and investors; it is the entrepreneur who must resolve to bootstrap financing, which is working with the limited cash, eliminating unnecessary expenses, establishing a credit line from suppliers and producing only on demand to avoid tying up resources.
ABOUT DEBBIE LARRY-IZAMOJE
Debbie Larry-Izamoje AKA The Entrepreneur’s Best-Friend holds a BSc in Information management from the University of Sheffield, United Kingdom. And MSc in management from University College London (UCL). She has also secured certificates in user innovation from Massachusetts Institute of Technology (MIT) and Innovation and strategy from Harvard University.
She is on a mission to raise a generation of young established or soon to be established professionals who are more vocal about business difficulties while providing solutions through public speaking, training, workshops and coaching.
She is the founder of the Image Boosters a full service agency with core services in digital marketing, PR, branding and more.
Instagram: @dee_larry @imageboosters_