Robert is Agribusiness Consultant who studied Agribusiness Management
Small Scale Businesses
It is a dream of every business person to get a reasonable profit on any business which the person wants to venture in. Much as this is the case not every expectation of a business person results into a successful opportunity. Nowadays a lot of young and old individuals are eager to know as to which small scale business is very profitable which could see them becoming millionaires overnight. In every business it is not every business idea that will result into an opportunity as some ideas are just mere ones not viable enough to venture in. This article will take you through the 5 reasons why some small scale businesses fail to get more profits or fails completely.
1. Lack of proper market research
Market research is a research in business which aim at gathering market information on which products on the market are being liked by the consumers and how consumers want the products or services in offer to be improved. This is not all as it also involves gathering information on various problems and complaints that the consumers or buyers are facing. Through this market research an opportunity is easily discovered, business customers' problems are easily addressed resulting in happy customers. Now the big question which we could ask or have in mind is, why a lot of small scale businesses unable to do market research? Some of the possible reasons are lack of funding, lack of knowledge on how a market research is conducted among others.
2. Lack of business plan
A business plan is a road map that guides every business resulting in easy implementations and focus on the business. The business plan comprises the business description which gives more details as to which business will be conducted, where the business will be conducted, who will be running the business, where will the business get registered, what is the business be doing and what does it expects among others. The business plan also shows projected cash flows over a period of time and how the critical risks will be addressed. This is not all as it also shows overall cost and statements of profits or losses as well as sales forecasts over a certain period of time. However, most of small scale businesses are unable to have a well written business plan which acts as a guide in their business. With the coming in of an online learning material, different individuals are now able to write the business plan themselves with simple easy to use guide.
3. Lack of enough funding
Most of small scale businesses lack enough funding, which acts as a strong capital base. This is much the case as most of small scale business owners are unable to get the loans to pursue their dream businesses due to lack of collaterals as most of loan lenders requires certain conditions be achieved, which among others include collaterals which acts as surety for loan repayments as well as in case of defaults or incapacitation.
4. Copying of business ideas or using already used or written business plan
Copying of business idea is becoming a greater challenge to new individuals in the business because what works for John does not necessarily means it will work for Mark and what works in one area does not necessarily means it will work in another area. Similarly, using already written business plan is a problem because the business idea to business plan does not necessarily means it will work in your area or country bringing same projected profits since the competitor's analysis differs depending on locations.
5. I will do it alone mindset
Most of small business owners do not necessarily want to involve others in business, this might be the case as they do not want to share the profits or business returns. This results into a problem as knowledge sharing and implementation in business is a great good to go if you want to go higher in business.
In conclusion, this article has highlighted 5 reasons why some small scale businesses are failing to get a reasonable profit which could change their lives.