Having a vision and starting a business does not mean success.
Entrepreneurship is a process that needs proper management to maintain the idea and grow it into a success.
Entrepreneurs are those people who when they see a problem design the solution to that problem.
We have all seen start-ups flourish, and we have also seen some of them fail.
Failure of these companies is not only caused by financial problems or Zimbabwe’s inflationary environment.
There is much more to it.
You must have a solid financial plan, good accounting practices in place and a good marketing plan.
There are many things that are required that can uplift and maintain the success of a business.
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Below are the dos and don’ts of entrepreneurs:
Don’t choose wrong partners
Two Corinthians 6v14 God says: “Do not be unequally yoked.”
The Bible also talks about bad company ruining good morals.
When an entrepreneur chooses a partner who does not share the same vision with him, results are always bad.
Human beings are like machines.
Partners must be fit for the purpose. Having business partners is common because the benefits partnerships bring.
But it is tricky to pick the right business partner.
Choosing a partner just because he is your friend or relative doesn’t mean that the person is the right business partner for you.
Because a business partnership is like a marriage; that means there will be misunderstandings and fights. These misunderstandings and fights are necessary for the health of the enterprise but may grow to levels that can destroy the enterprise.
Too much planning
Planning is important.
However, it must be noted that the planning must be moderate.
Lack of planning is a recipe for disaster, but too much planning can also lead you to the same path.
Too much planning can, in fact weigh you down.
Instead, a good plan is always something that leads to a decision.
So, how do you make a good plan?
Focus on a few important points instead of addressing all your future challenges immediately. Strengthen what areas are already bringing revenue to the company before moving onto minor issues.
Don’t ignore public relations and marketing
Concentrating on all the other facets of the business but ignoring good public relations and marketing of the organisation and its products can lead to disaster.
No matter how beautiful or how your product or service is; if you don’t market it well, it ends up being your own to consume.
Ignoring marketing is digging an own grave.
Don’t assume your employees know as much as you do about a transaction.
They can’t read your mind.
Communication is key.
If you are not giving them the full information, they could make incorrect assumptions and take your business off track.
You also want to review their work. They do their best, but it is not uncommon for items to be misinterpreted or for them to make mistakes.
Don’t be scared of numbers
It is crucial that you take the time to understand your financials and, above all, don’t be afraid to ask for help. The more questions you ask, the more explanations you will receive, and over time the numbers will start to make more sense. Set aside a few hours each month to devote to the review of your financials. If you can’t get an expert to join you, log your questions and follow up with them.
Don’t ignore the voice of branding
Your brand reflects your consistency and when you are inconsistent, people lose their trust in you.
How do you destroy your brand? Ignoring your customers, not listening to criticisms and feedback, and refusing to change are a sure fire way to destroy your brand.
A brand talks to stakeholders. Stakeholders make decisions from what they see and here. Your brand talks!
Don’t wear too many hats
I have often seen so many entrepreneurs multitasking.
These believe that they are the brains behind their businesses therefore they do everything better than all the other employees.
But they end up neglecting critical thinking.
Research has already found evidence that multitasking can harm your brain and affect your productivity.
Multitasking will not make your company grow quickly or increase your profits.
In fact, it can do the opposite because you will wear yourself down by wearing too many different hats. Successful business people like Jeff Bezos, Elon Musks and Strive Masiyiwa are all known for a particular business line. By so doing, they have learnt to master the game. If you lack focus, you won’t just be harming your business but your relationships with your clients and partners as well.
Customers are a special type of stakeholders.
They are happy to partner a business that focusses on improving the service they get for product they are offered.
However, it should be noted that diversification is not a lack of focus.
Listen to customers
Customers are the reason why a business is created.
A vision follows a path of satisfying customers who end up becoming clients.
Customers play the most important role for the business leader.
To me, the customer is on the apex of the stakeholder ladder. Product reviews and feedback should be provided for customers’ reviews.
They help you gauge which approaches work best with your customers and which don’t. Paying attention to these helps you improve your business and avoid approaches which do not work well with your customers.
When your customers see that you care about what they have to say, you will be able to earn their loyalty.
More so, they will become your most effective marketers.
Word of mouth spreads like veld fire. Once customers are happy to be part of your brand they make referrals which costs nothing financially to the business. Satisfied clients always make repeated sales.
Trying to be perfect
Everybody is familiar with the quote which says that nobody is perfect; this is true.
Each one of us has flaws, so do businesses.
It is natural to make mistakes. It is a fact of life that mistakes are inevitable. When this happens, get up and find out what is wrong, re-strategise, and start all over again.
What is important is not to keep making the same mistakes. It follows that there is a great need to establish a research and development department.
Don't become too predictable.
Your plans must not be predictable by competition. Competition may use it against you. Keep your formula to your chest.
Don’t wait for too long to launch
It is easy for the scope of your project to get out of hand.
However, the product you have does not need to be perfect at first, and the additional buttons and features you painstakingly add are not necessarily fundamental. When you get your product out there, you can get feedback easily and you can modify your product/service along the way.
Waiting too long can contribute to a loss of momentum. Nike says; “JUST DO IT.” Indeed, what are you waiting for? Just do it!
Keep tight financial control
The best new businesses - large or small - keep tight financial controls and understand where revenues come from and where expenses are going.
Monitoring your books with precision will not only help you understand the flow of the business, but allow less room for error.
Keep your business and personal finances separate.
Most start-ups make the mistake of believing that what the business is generating is personally theirs. The business is a legal persona on its own. It’s not fun to sit at a bank for hours on end, but it is important to open a separate business account. The business must have a budget and manage its own finances. If you start off with your accounts combined, there will come a day when you need to unravel the two. This is not only costly and inconvenient, it’s also extremely time consuming and takes you away from the work that really matters. The business has its own debts and needs to grow and maintain its own affairs.
Understand your costs.
When businesses collapse, it is usually because of liquidity crises.
This crisis may have been caused by not understanding the escalation of costs or not managing costs. Take time to figure out why your costs are changing. Doing so will not make you a tight wad, it will make you successful. If you can confidently explain why you spend “x” amount of dollars on one particular product while cutting back on another, you will be able to make financial decisions in the future that could make or break you. Wasting money is not an option in a start-up or any business. Control your expenses better than your competition. This is where you can always find the competitive advantage. You can make a lot of different mistakes and still recover if you run an efficient operation. Or you can be brilliant and still go out of business if you are inefficient.
Have a good accountant
Most of the times for a start up there won’t be need to employ a full time accountant.
The business leader can choose to hire an accounting consultant like this writer to help with the accounts. A good accountant knows his numbers well. He can advise on taxes due, costs and can guide on good cash flow management. Understanding cash flows can make the business remain liquid. What good will it be if one day the business ends up with tax debts. This can lead to unnecessary legal costs too. Periodically review your financials. I repeat; good accounting and bookkeeping is the difference between businesses. Yes, good cash flow management is the difference. I can’t stress this enough: DON’T FALL BEHIND. Confirming that your financials are in good hands will make your life easier and will help to ensure the success of your business all while keeping excess costs to fix your financials at bay. That accounting class your neighbour took in college doesn’t make them an expert and the five months your mom worked in an accounting firm doesn’t make her a bookkeeper. If you put your financials in wrong hands in order to save money, chances are they won’t be done right and the cost of fixing them will drastically exceed what you originally wanted to pay. Use experts. You get what you pay for in all aspects of life. Do realise that poor financial reporting makes lenders and investors lose confidence. I once overheard a lender asking a business owner if they knew “anything” about their business’s finances when they were receiving the projections for a loan. Don’t be that person. Chances are that loan will fall through and you’ll be back at square one. Impress the people who want to help you succeed. After all, a part of your future is in their hands.
Do commit to your business.
Believe in it more than anybody else. If you love your work, you'll be out there every day trying to do it the best you possibly can, and pretty soon everybody around will catch the passion from you – like a fever. Lead Lead Lead! You are the example. You are the pillar for all your employees.
Share your profits with all your associates and treat them as partners.
In turn, they will treat you as a partner, and together you will all perform beyond your wildest expectations. Money and ownership alone aren't enough. Set high goals, encourage competition, and then keep score.
Effective leaders and successful businesses are accountable. When there’s no accountability, there is no standard to measure employee performance and as well the leader’s performance. As a result, good employees are not recognised and bad employees are not penalised. In the end, the good employees are frustrated and leave the company. What happens next is not difficult to guess.
Talk less and work more.
DO Communicate everything you possibly can to your partners.
The more they know, the more they'll understand. The more they understand, the more they'll care. Once they care, there's nothing that will stop them.
Do Appreciate everything your associates do for the business.
Nothing else can quite substitute for a few well-chosen, well-timed, sincere words of praise. They're absolutely free – and worth a fortune.
DO celebrate your success.
Don't take yourself so seriously. Loosen up, and everybody around you will loosen up. Have fun. Show enthusiasm – always. All of this is more important, and more fun, than you think, and it really fools competition.
Listen to everyone in your company.
And figure out ways to get them talking. To push responsibility down in your organization, and to force good ideas to bubble up within it, you must listen to what your associates are trying to tell you. They know something you don’t know. This gives better feedback.
Aim at exceeding your customers’ expectations.
Give them what they want — and a little more. Make good on all your mistakes, and don't make excuses — apologize. Stand behind everything you do.
Go the other way. Ignore the conventional wisdom. If everybody else is doing it one way, there's a good chance you can find your niche by going in exactly the opposite direction.
Have a mentor
A mentor helps you to avoid mistakes that have been committed before. He also helps to show ways that have tried and tested that paces up or quickens your way to success. A mentor can rebuke and correct you’re the Business’ leader’s shortcomings.
- Chitambira is the founder of SMARTFISCAL CONSULTANTS – a Business Advisory firm, He is a cut above the rest business consultant, Business trainer, entrepreneur, Tax consultant and business developer. He has interests in agriculture as well as marketing fields. He can be reached at cell/WhatsApp: +263775844941 or email: [email protected]; website: www.smartfiscal.co.zw