An entrepreneur is defined as someone who conceives an idea and turns it to a profitable business that leads to financial independence. Almost everybody in Nigeria is an entrepreneur today. However, it seems that most fade off as fast as they spring up. Why is this so? This may be due to salient issues that most budding entrepreneurs have not considered. Below are 4 of the areas you should think about before investing in that business.
- You are not a professional in the field: Now, this sounds pretty rudimentary, right? But it is still a basic fact. Never invest in what you know little to nothing about. How would you know the most cost-efficient methods of operations? However, most entrepreneurs in Nigeria today see a particular person succeeding in a business and jump right into it. If you are so confident that a business is a profitable venture and you know little about it, take time to learn about it.
- Poor risk management: True, there is no business without risks. In fact, there is nothing in life that does not have risks. However, the key to ensuring profitability is to understand what the risks are and how severely they can affect your business. Several entrepreneurs though, forget that there is a reason the phrase reads ‘calculated’ risks. How well am I doing in that area now? If you cannot satisfactorily answer, maybe you should reconsider before starting up your business.
- Lack of business nous: Some people call it being street smart, others say it is being business savvy. Whatever it is called, if an entrepreneur cannot understand ways to enhance profits, then there’s trouble. Understand what taxes are can crush your profits and find ways to reduce them (legal ways, of course). Please do not confuse this with tax evasion. If I do not import goods, I cannot be billed import tax, can I? So develop this skill before you start the business.
- Poor budgetary control: Most entrepreneurs are so excited about their ideas (and the fact that they can eventually fund it) that they forget about financial responsibility. For those who have a budget, they probably do not have an expense sheet where expenses at each stage of the business are kept. If you cannot vouch for your budgetary control now, how much so (or less so) when you actually float your business?
These simple areas are often neglected in the euphoria of that brilliant idea that will yield several millions. And they may also be why many Nigerian entrepreneurs fail before even starting. Have any more reasons you feel entrepreneurs fail before they start. Feel free to let us know.
News Team/Punch Newspapers