Reasons Why Black Businesses Fail In 12 Months
I ran across a very interesting article today. On the HBCUbuzz.com website, I found this article entitled, “12 Reasons Why Black Businesses Fail Within The First 12 Months.”
Here are the subtitles for those 12 Reasons:
- Too Many Alphas & No Betas
- No Research
- Insufficient Funds
- Failure to Adapt
- Family Member, Not Business Partner
- No Consistent Vision
- Failure to Diversity Our Products
- No Experience
- Failure to Provide Good Customer Service
- Failure to Market Online
- Lack of Leadership
- Lack of Followership
If you want detailed information regarding the way the article spins these 12 reasons, read it here: http://hbcubuzz.com/12-reasons-black-businesses-fail-within-first-12-months/.
All of the reasons above are extremely important to cover as you set out to start your own business. But I would also encourage you to delve deeply into how you can actually solve these problems. This article does a great job saying what’s wrong, BUT NOT HOW TO FIX IT.
If I had to pick my top reasons from the list above for why black businesses fail within the first 12 months, I would choose the following six: 1, 2, 3, 6, 9, 11.
A. Too Many Alphas & No Betas
I have seen this time and time again, even in my own collaborative efforts with others. It seems that everyone wants to be the top dog, but in most cases, those who want the power aren’t willing to do what it takes to have the power. Starting a business is not easy. There are a lot of nitty gritty odd and tedious jobs that need to be done while setting up a business. Documents have to be filed, supplies and equipment need to be purchased, plans need to be drafted and updated, offices need to be set up and cleaned, etc. It’s great to be able to bark orders or tell people what you want or desire, but do you really know what it takes to get there? Until you can fully grasp what is needed to run your business, you will never know the total extent of the risks involved with maintaining your business success.
In order to avoid this business failure, I suggest drafting a business plan, either high level or low level. Your business plan will help you understand all of the necessary steps involved with getting your business going. After you develop the plan, be prepared to be able to work ANY task identified in the business plan. NOTHING in your business plan should seem as if it is BENEATH YOU. If you know how to do it, then you can easily explain it to someone else or backfill them when some unforeseen event comes up.
B. No Research
I have often witnessed people wanting to start a business because they saw someone else do something similar and become successful at it. The new entrepreneur then thinks, “Well, if they can do it, I can do it too!” They excitedly run off and try to start a business with no solid foundation or know-how. BIG MISTAKE.
Before you start any business, you should definitely research your field of endeavor. I encourage you to do this because you not only want to know what it takes to be successful, you also want to know if you’re going to actually LIKE or LOVE what it is you will be doing. When you decide to become an entrepreneur, you have also decided to sacrifice your time and effort for building a business from the ground up. Pursuing something that you actually like will help you to persevere.
C. Insufficient Funds
This is a no-brainer. Of course it takes money to make money. But developing your business plan should help you with this one. Once you get your business plan done, you then need to start piecing together a budget. One of two things will happen. You will either be able to afford all of the items identified in your business plan, or only a few of them. After you find out exactly what it is that you can afford to get your business off the ground, add a timeline for accomplishments to your business plan. For items that you cannot afford, push them to a subsequent phase of development for your business. All great things take time to build or accomplish!
D. No Consistent Vision
Again, this problem can be resolved by having a business plan in place. Your business plan should contain your vision. Every step performed in accordance to your business plan should align with your vision statements. Many people get caught up with chasing trends in the industry or keeping up with the Jones’. Although it is great to know what other people in your industry are doing, you should always keep in mind that it is your UNIQUE VISION that will set you apart from everyone else. Stick to your vision unless it is absolutely necessary to modify your vision to avoid future business risks.
E. Failure to Provide Good Customer Service
You would think that everyone tries to do their best to ensure new clients become repeat clients. But this is not always the case with many new businesses. Many new entrepreneurs become overwhelmed and burnt out in the first year of their business. They quickly learn that starting a business entails much more work than they had anticipated. Because stress levels are high and energy is low, new entrepreneurs sometimes forget to harness their soft skills. They may begin to stop offering kind, inviting words to their clients and customers. They may also send the wrong messages to their customers by using negative body language. The ONLY way to avoid this risk is to always monitor your body language and communication with your clients and customers. You should ask for feedback as well. Use all customer feedback to your advantage and do not get offended if objective comments are made that you do not agree with. Simply learn from them, and then improve your customer service skills.
F. Lack of Leadership
The minute you decide to become an entrepreneur, you have also decided to become a leader in your field of endeavor. But do you really know what it means to be a leader??? The best leaders are people who know how to lead as well as follow. Great leaders are not only prepared for good times with the business, they know how to handle bad times as well! They demonstrate calmness, smarts, and finesse in times of adversity. Having to deal with business needs and crises on an everyday basis can be extremely challenging, but you have got prepare yourself to be a great leader if you want to be a successful entrepreneur. The best way to do this is to find mentors or other business leaders who demonstrate superb leadership skills. Meet with them if you can to learn from them. You will want to know the path they took to become such excellent leaders. If you cannot meet with, simply monitory their actions and demeanors. Try to emulate them, using your own style of course, whenever you can.
Don’t become a victim of any of the failures above. Be proactive about the success of your business. Most importantly share this information with other black business owners that you know. The more that everyone understands the common issues that we all face makes for the more we can work together to overcome them!
Let’s get it, My Go-Getters!
XOBrought to you by:
Daymond E. Lavine