08/19/2021
Why do people start businesses but don’t start businesses?
Hi! My name is Charles King - The Head Cruncher in Charge, and I am an outside innovator. I evaluate organizations and share my opinions on where they can improve.
In the global economy of the 21st century, we see that has moved from a brick-and-mortar economy to a click and order economy. There has been a massive shift in the economy from traditional jobs to independent contractors and self-proclaimed entrepreneurs. The saddest group of these individuals are those who start a business gain traction but continue to operate in a deficit – these organizations continue to not expand or grow and eventually stay stuck. Why is that? Why do people start businesses to be stuck again?
I would argue that those individuals don’t expand or start their business for 3 reasons:
Lack of understanding
Poor financial management
Lack of operational management
The majority of single-member LLCs haven't grasped who they are catering to, and they are unaware of their ideal client. This lack of understanding ultimately stunts their growth and this is because a lack of vision impairs the entrepreneur's ability to prospect and remain motivated. This is fixed by thoroughly developing your business plan and building your dream customer. Once the dream customer is built you can then target them and set goals to grow your business.
Poor financial management is the kamikaze of the business world; meaning it is the fastest way to kill your business and what's worse is that it was done by the business owner. This is the fastest way to kill your business because it is often the most overlooked aspect of a business. Capital management is either not discussed because it's more enjoyable to discuss ways of business development and possible revenue streams. Although those things should be discussed, the priority should be on where to place the revenue. This is fixed by hiring a contractor to build budgets and aggregate data to allow you to make accurate decisions swiftly.
Lastly, a lack of operational management, causes your business to not start because the gears within aren’t turning properly. This lack of operational management prohibits growth because you are unable to hire more employees, if you can't train them properly what was intended to be a benefit for your company will become your demise. This is corrected by first looking at positions and to begin determining where the lack of productivity is. After determining where the lack of productivity is then beginning to "trim the fat" if needed or expend more capital to better train the employees you have.
Entrepreneurship isn't easy and it shouldn't be done alone, everyone should have a , someone who assists you make decisions and think critically about your business.
