As more and more people become attracted to the idea of running their own business,it seems the concept of business is becoming a buzzword.
Infact, some people venture into business without any understanding, adequate planning or strategy. What exactly are three most common but costly mistakes you can make while starting a business venture?
Assuming that skill acquisition is entrepreneurship.
On a close conversation with several business owners, I have observed that many think that skill acquisition is entrepreneurship. They believe that once an individual acquires a particular skill, perhaps in an area of passion, that person automatically becomes an entrepreneur. This is very wrong.
Simply put entrepreneurship can be described as the process of deliberately creating efficient solutions to observed problems.
Therefore, if you acquire a skill and do not decipher how to utilize it in creating efficient solutions to problems, you are far from an entrepreneur.
Now, do not go off feeling bad because you have done nothing wrong. There is nothing wrong with acquiring a skill. It is just important to make these distinctions clear.
There is a difference between entrepreneurship and skill acquisition. An entrepreneur might acquire or hire several skills to create solutions but a skilled person is not necessarily an entrepreneur.
Not making adequate provision
Some people make the mistake of thinking that their business would thrive immediately they commence.
Perhaps, they believe it is a fast moving consumer good. In addition, they might begin to assume that the demand for their product would be high since there is noticeable evidence of a great need in that geographical location.
Hence, they fail to research these observations or make room for additional operational costs
Thus, when the business fails to thrive at the onset they are unable to sustain it. This eventually leads to lack of continuity and subsequent business failure.
Statistics suggest that 70% of businesses fail within their first five years of operation. Failure to make adequate provision for operating cost is a key part of this figure.
Starting a venture they cannot sustain.
Tonia is a 35 years-old career mum of two. She has always wanted to venture into a business of her own at some point in her career. But she needed money and has been saving up judiciously for years.
Finally, Tonia felt she has saved enough to start but there was a problem.The problem is that Tonia is a bit unsure of what business to venture into. She has never sold anything in her entire life and didn’t like cooking.
One day, while flipping through her social media page, she stumbled on a particular business page that held her spellbound. Tonia loved what she saw.That same day,Tonia decided to become a fashion designer.
Three months later, with no knowledge, experience or design skill, Tonia launched a modern fashion house in a highbrow area in town. Eight months later, there was an incident with a high networth customer. Tonia wasted no time in giving the entire staff a piece of her mind.
However, two days later, Tonia arrived at her business place to discover that all her staff had resigned. A devastated Tonia struggled between pacifying customers and searching for new staff to complete the remaining orders. Tonia was so frustrated
that she shut down her business temporarily in order to resume in a fashion school.
No matter how rich you are, be wary of venturing into any business that you do not have the capacity to sustain. This is because, great businesses strive for expertise and expertise comes with knowledge and practice. It does not come from spending hours drooling over other people’s social media pages trying to copy what they have done.
Finally, the idea of being independent and running your own business might be attractive. This is especially true in this era of social media which has made business more appealing. Nonetheless, as a new business, it is advisable to understand self, make necessary plans and adequate financial provisions to sustain yourself and your business. You do not want to be like Tonia.
Ngozi Ojo is a writer and business consultant. For further enquiries email firstname.lastname@example.org