New businesses start before stepping its good entrepreneur knows the factors of success and failure of effort (which is called the entrepreneurial Failure Factor) which will be at doing it. By understanding the factors of achievement and failure of business then aspiring entrepreneurs can make a plan to expect and crack down on up when things happen outside of the original planning.
Understanding Entrepreneurship:
People who can view and assess business opportunities, gather the resources needed to take advantage of fast action and in ensuring its success.
Spirit, attitude, behavior and a person's ability to deal with the business or activities of which leads to the efforts of the workings of the technology and new products by improving efficiency to provide better service and greater profits. The result of starting a business is to be aware.
There are eight factors of Entrepreneurial Failure include:
1. improper Planning and mature.
2. Lack of understanding of business and place of business.
3. lack of experience and marketing strategy.
4. lack of knowledge in the procurement and maintenance of materials and means.
5. Less its administrative and financial management of reliability.
6. The lack of safety of capital management and credit control.
7. The lack of credibility of the human resources insightful entrepreneur.
8. Lack of understanding of technological change.
1. improper Planning and mature
Fail in planning. The failure in implementing the plan is due to plans that have been created based on the experiences of others or an idealist who has never applied. This failure occurs because they don't know at all conditions or terrain venture investments. Factors that support the failure in carrying out or implementing the plan is from within yourself.
2. Lack of understanding of business and place of business
Understanding the contextual basis and strategy not only how a product that has value added and made. But the need for using understand of the needs of the community will be the product, either in frequency, quantity, shape/type and quality. The understanding also related efforts towards infrastructure such as be in businesses, business info, business completeness condition.
For example, a mother whose clever once cooking is unsuccessful in trying restaurants because the firm is not only about understanding the production process only.
For example again: companies hired hundreds of millions will not bring business success, if it has no market proximity and ease of access (access-based physical and technology outreach). The proximity of be in the source of the raw materials/the source of production is also an important part because it can efficient the cost of transportation and production.
3. Lack of experience and marketing strategies
Entrepreneurship in community effort still needs to have experience of business. Reply if the financiers and owners have yet to experience then I would buy those for staff or partners in the venture, either or consultants. Experience dealing with how to sell, to whom it sells, bind customers, capture the reactions of customers, etc.
The community entrepreneurial behavior, capable and active in the production. Both in the business of crafts, food, services and others but has no power and methods of the systematic marketing concept and, when the day was lucky so does not account for the possibility of the coming months even years to come.
The applied marketing traditional and still prone to scramble for customers by competitors. There is no attempt to build loyalty and fanaticism. Can the micro build enthusiasm? Able.
Example: when I patch the leaky vehicle tire I picked one artisan clamp tires from 3 is because it is the quality of the resulting patch burning tool and anybody that is communicative, appreciate and repeat and criticized when less than perfect results.
4. lack of understanding in the procurement and maintenance of materials and means.
Procurement of raw materials is not just the logic of buying fresh chilies, meat in a homemade meal or cement, iron logic in the business building, but rather to how the raw material instead. Many of the new businesses opening the business buying raw materials as much as possible but not with understanding how the raw materials instead, and by using understanding the frequency of use of raw materials daily, weekly and community demand.
5. Less its administrative and financial management of reliability
Policy strategy decision in determining the apparent self-employment should not rely on gut feelings and instincts. But the Administration's record in history needs to be made in determining the capital decision. Policies/Decision herbalists data. So too regarding finance, many cases pioneered efforts did not have the power of real financial information, so the owners don't understand will be regular income, cannot correlations between income, sales and use of raw materials. So the possibility of abuse in the lower level can be run without being noticed.
6. The lack of reliability of capital management and credit control
A good entrepreneur understands capital not only money. The credit so to the banks is not one solution, let alone take the maximum credit ceiling of collateral, which are not considered of the operational needs. Many become micro-entrepreneurs credit as expansion production and investment. No accuracy in taking into account the need for capital injections with the ability to pay and the scale of his liquidity. For example, if your customer liquidity always cash pay or delay payment. When your credit Filed to the bank, you should also be careful in giving credit or pending payment to your customers, sort-parse which ones are and not, and specify the attitude scale priorities.
The pseudo capital and not with separate interests/personal needs also became the early failure of attempts, withdrawals from the company/store too often and faster but do not take into account current payments and the income of the company/store/business.
7. The lack of reliability of the human resources that an insightful entrepreneur
A true entrepreneur does not make his entire family was the staff of the company/store/efforts. Why? Because of the relationship that is too liquid in the family can eliminate primary performance function should be.
Suppose the leadership may admonish the process management of Procurement items are standard, however, because the responsible staff is brother-in-law, then reluctant to advise, and assume that later will change.
Human resources are an insightful entrepreneur then will form hardy souls. Because it thought besides her staff but also someone who is convinced that with success in his field then he managed as entrepreneurial business owners like want. Though only in the works as if working a success also personal satisfaction and teamwork. So the staff has staying power against the problems that arise because it assumes that the problem is part of the process of entrepreneurship.
The trick, don't make your staff a robot should partake in command but also given the challenge to analyze the improvements, and there is periodic reward, here's the thing not done ability and one failure in human resources.
Enter the value of entrepreneurial motivation work blending in subordinates is not an easy thing, but if you give the challenge and achievement standards per unit, then it is one form of education, living harmonizations method between divisions.
Deficiencies in determining the qualifications of staff in recruitment cause failing to increase continue the effort. So planning a good business always prepare the source criteria Human Resources Division each new hiring. Do not reverse.
8. Lack of understanding of technological change
Technology understanding for human resources should not be associated with the computer and the internet, but also based on the ease of the impact of existing technology.
The failure of the effort of understanding this technology is not due to comprehend the purchase but also maintenance.
Suppose a lot of financial data, customer data is missing because of a virus, or the inability of staff to protect consumer information files. So that there are competitors who could take through one of his staff who wants to hit end the working relationship or move on, so the data used by competitors.
The technology is also related to predict the reliability of the device in use today to survive in the next 5 to 15 years. And let the human resources must learn to keep up with technological developments.
Technology also Assembled with real marketing success in designing graphics, publication profiles in a cd, create a website or blog for free. Don't think small businesses don't need a website because some time ago I designed a web system small business promotion for sewing clothes, the current order from some cities in website development results have already arrived. The important thing is to create a unique product, while the price, results, user and feel is a companion factor.
Thus the review article "8 factors of Entrepreneurial Failure". May be useful for the reader. The key "Courageous decisions."
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