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Topic: WHY SMALL BUSINESSES FAIL

  1. #1
    Newbie okmoreal's Avatar
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    Sep 2008
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    WHY SMALL BUSINESSES FAIL

    WHY SMALL BUSINESSES FAIL

    POOR LOCATION: Some of the reasons why start-up fail is the inability to situate in a good area for business. Sometimes some organizations are located far away from raw materials and factors of production like labour. If a fast food is located close to a bank, the business will thrive and if a boat manufacturer is located in the neighbourhood there will hardly be sales because it is not a riverine area.

    MISUSE OF FUNDS: Mismanagement of business of business fund is a big problem that causes stunted growth. If a business begins to make profit, part of it should be reserved for the future plan and continous existence. Atleast 40% should be added back to the capital and not misused by the business owner for luxurious spending.

    LACK OF SUFFICIENT CAPITAL: So many small businesses have this problem as there number one, because it is the capital that will make provision for office and equipment, staffing, cost of production and advertising. Sometimes start-ups need good capital depending on the plan of the business for instance, you cannot run a cyber cafe with as low as a hundred thousand naira. You would have to consider the cost of getting an office that is the rent, then the computers, printers, ISP(Internet service provider), furniture etc.

    LACK OF EXPERIENCE: Where a business owner fails to make a good plan there would be failure in the long run of the business and this is as a result of inexperience,also if a businessman does not understand the kind of business to do and how to manage people very well there would be problems.Inability to convince investors with a good business plan and a proposal is going to be a big problem,a business person should enjoy and be passionate about his or her business.

    OVER-INVESTMENT IN FIXED ASSETS: Sometimes some companies have made mistakes in the area of acquiring gadgets, machinery and buildings. If an upcoming business should have over sufficient space and they paying for the rent, it affects the size of their capital because such space is not used to give them extra income. It is dangerous to have excessive working equipment and over staffing.


    COMPETITION: Some business cannot cope with the rising effects of competition in their area of specification, because of lack of good planning strategy which could sometimes be as a result of piggy-backing. Piggybacking means depending on a bigger business for survival, some businesses find it difficult to build their brand and differentiate themselves from the crowd which a problem and one of the biggest reasons small businesses fail.

    I remain your business consultant anytime,always at your service,keep a date with me weekly(every wednesday).See you at the top.Wishing my dear readers, a Merry Christmas and a Prosperous New Year.

    Mr Emmanuel.
    07040406923.


  2. #2
    Newbie olammilekan's Avatar
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    Jun 2008
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    Re: WHY SMALL BUSINESSES FAIL


    nice one thanks alot am an engr presently working with a company have been working for quiet sometime now am interested in running a small business to compliment my earnings rather to plan for tomorrow along side my work but am not good in this so call business of a thing have tried once but failled for about 4yrs
    am weak in managing people i don't seems to know how to go about it am really interested in business i so much belief i can do it
    another problem am having is what kind of business can i do with N100,000 to N150,000 though am not interested in immediate profit
    am email add is [email protected]
    olammi

  3. #3
    Moderator coolguy's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    this is good
    I am a slow walker but I never walk backwards.

  4. #4
    Newbie josonnoh's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    I find this post worth the space. I admire your point specifically the Undercapitalisation and Saving 40% of profits part.
    I currently study Telecom Engineering in one of Naija's Fed Poly and I'm training to be a entrepreneur and employ people. Everything about business piques my interest. Do keep up the good enlightenment work.

  5. #5
    Newbie sdsshares's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    This is a very interesting post. And thanks for it. Although it didn't go too deep in bringing the ups and downs, but it clearly shows that you know what you are talking about.

    Please be around to moderate this as I'm quite sure alot of people would pick interest in it.


  6. #6
    Senior Member dawaskee's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    Thanks!
    This is good!
    Oneluv.
    Cash Rules Everytin Around Me(CREAM)...

  7. #7
    Newbie okmoreal's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    DEAR READERS,
    Thanks for the reply,i love your courage and interest in this class.I promise to put in my best like i always do.Thanks sdsshares,josonnoh, davaskee,coolguy for the encouragement i'm at your service,i'm very sure you will gain more by the grace of God.As for olammilekan,i will give you more highlight on how to manage people or your employee so you won't fail in business anymore.There a lot of business you can do with that amount of money,do what you like best and you will succeed in your specialized field.you can also visit www.onlineways.info to learn more on business you can do.To your success.See you at the top.
    Thanks,I still remain MR EMMANUEL.

  8. #8
    Newbie mr dollar's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    Thanks for the informative article.
    another reason why small business
    fail is lack of planning and lack of
    knowlege of how the business
    work.

  9. #9
    Newbie PAYCEE's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    Thks alot 4 d info. Pls send us ur email address or phone no.

  10. #10
    Newbie legendary's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    Nice one Mr Emmanuel. If you guys need more info, just get NIM study pack on Small Business Management (SMPE 104). It's complete with a list of businesses you can start and plenty more. The easiest way to get one is through a corps member.
    All the best!

  11. #11
    Newbie femHans's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    Emmanuel, thump up for you. That's quite a good piece. May I add that small business fail (amongst others reasons) for the inability of the owner to separate business from pleasure, family and friends. Failure to provide insurance protection for assets of the business - car, buildings/office space, furniture and other office equipment can also be devastating in case of unexpected loss or damage to such assets.

    To our other engineer friend; he needs training in the management of resources and should be advised that no amount is too small to start a business since present day conglomerates are started as cottage business in a family sitting room, at times small space.

    To all prospective enterpreneurs please note that once you can dream it you can have it. Best of luck from me.

  12. #12
    Newbie goldenceo's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    You have not mentioned a very important part of why small
    businesses fail.

    It is marketing.

    A lot of small businesses all over the place are not marketing
    themselves effectively while some are not doing it at all.

    It is marketing..marketing..marketing.

    You need to understand this.

  13. #13
    Newbie adebayoadelakun's Avatar
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    Re: WHY SMALL BUSINESSES FAIL

    Thank you for this informative and educative topic.

    It really affected me directly because i''m on the way to getting frustrated to a cafe business i started a year ago. And you know the frustration that follows it.

    It was undercapitalised and so it was so difficult to break-even. Though I have a diploma in computer maintenance and a passion for computing...joyfully i can stay on the net for over 12 hours.

    However, the problem is more compounded by lack of capital.

    I wish to get anyone with capital; I will be a good partner. This business is so lucrative.

    I wish you guys would reply to save this situation.

    God bless.

    [email protected]
    07030331927

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