Why Small Businesses Fail to Grow?
"No one is rich or poor who has not helped himself to be so." - German Proverb
These words represent one of the strongest motivations by which individuals seek to become entrepreneurs. An entrepreneur can simply be defined as someone who undertakes and operates a business venture. History has shown that many have chosen to chart this course of self employment in a bid to play a role in determining their own destinies. However, the process of undertaking the business venture is where the challenges and problems lie. There are a number of factors that could ultimately lead to the downfall of small businesses such as: the failure to draw a proper business plan, insufficient capital, entry of a new competitor, having a seasonal business; to mention a few. These factors can be grouped as internally generated; when caused by the entrepreneur himself, and externally generated, when caused by outside forces beyond his/her control.
The entrepreneur’s role in determining the success or failure of the business cannot be underestimated. Basically it’s not enough for an entrepreneur to have a great idea to achieve success, but the other steps and choices that are made after, lead to the business success or failure. Some entrepreneurs fail to grow their businesses because of the refusal to take responsibility for their mistakes, and then put the blame on other factors. By doing this they hinder themselves from thoroughly analysing the feasibility of the business idea and making necessary adjustments that may be required such as; securing more capital or hiring competent managers.
Furthermore, the entrepreneur has to be willing to do all it takes to make the business grow. At the early stages of any business, there are a number of administrative tasks that need to be carried out and usually the entrepreneur might have to multi task to get them done. This failure to put in enough effort could lead to other problems such as: absence of performance
These words represent one of the strongest motivations by which individuals seek to become entrepreneurs. An entrepreneur can simply be defined as someone who undertakes and operates a business venture. History has shown that many have chosen to chart this course of self employment in a bid to play a role in determining their own destinies. However, the process of undertaking the business venture is where the challenges and problems lie. There are a number of factors that could ultimately lead to the downfall of small businesses such as: the failure to draw a proper business plan, insufficient capital, entry of a new competitor, having a seasonal business; to mention a few. These factors can be grouped as internally generated; when caused by the entrepreneur himself, and externally generated, when caused by outside forces beyond his/her control.
The entrepreneur’s role in determining the success or failure of the business cannot be underestimated. Basically it’s not enough for an entrepreneur to have a great idea to achieve success, but the other steps and choices that are made after, lead to the business success or failure. Some entrepreneurs fail to grow their businesses because of the refusal to take responsibility for their mistakes, and then put the blame on other factors. By doing this they hinder themselves from thoroughly analysing the feasibility of the business idea and making necessary adjustments that may be required such as; securing more capital or hiring competent managers.
Furthermore, the entrepreneur has to be willing to do all it takes to make the business grow. At the early stages of any business, there are a number of administrative tasks that need to be carried out and usually the entrepreneur might have to multi task to get them done. This failure to put in enough effort could lead to other problems such as: absence of performance
References: * www.ajol.info/index.php/kjbm/article- KCA Journal of business management: Vol.2,issue 1(2009) * www.businesssample.small-businessmarketinginfo.com/2010/06-Article by Moya k * www.forentrepreneurs.com/businessmodel/why-start-ups-fail/- Article by David Skok, 2010. Article by Tunde Adelekun, 2011 * www.hoovers.com/business-information/global-hoov- index/html- Fastest growing small businesses Article by Michael Mclellan, 2010. * www.scottish-enterprise.com/media/SE/Resources/Documents/about-us/research/enterprise- High growth firms in Scotland by Colin Mason and Ross Brown, 2010.