The topic was: “Why indigenous Zimbabwean youths cannot build really successful and sustainable businesses.” everyone is free to add their comments to the discussion.
My reason is that the majority of the youths grew up in the worst period of Zimbabwe’s economic history. As a result, the business lessons they have, were learned during a period when almost every business person was operating crookedly, illegally and without a care for values and ethics.
One of the first to comment was Rutendo, who said, “These are very true thoughts, but we have to do something now to end that in our youths, especially giving them the necessary knowledge because the business environment is changing day by day.”
A young business owner, Charlie, said: “Not all of us fall into this bracket. Some of us are working so hard, distributing quality products and services. We are only limited by resources, and the resources available for youths seem to be benefitting the same people all the time.”
Do you agree? Please post your thoughts about this interesting topic at the website.Now we all know that entrepreneurship is a risky business. In fact, entrepreneurs are known for being risk takers. But they are not daredevils who blindly take suicidal risks.
Risk being a fact of life and business, you need to find ways of managing and reducing it if your business is to grow and not collapse like what happens within 10 years to 90% of all new businesses.Here are some strategic ways of reducing risk in your business:
Plan, plan and plan. The majority of business owners do not take the time to write down a business plan. Business being so risky, starting up and operating without a solid plan is very dangerous.
Some keep plans in their heads, but ordinary humans are not good at remembering everything, especially when under the pressure of running a new business.
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Developing a real business plan is a process that will force you to think of the many risks that could affect your business. It will also call for you to carry out proper market research that will show whether or not your business idea is viable. As you go through the process, you will have to think of ways of countering and reducing the various risks. So when the risks actually happen, you will be prepared and ready to act to reduce the damage.
Trust cash One of the biggest threats to business survival is running out of cash. Some entrepreneurs have come to rely too much on borrowings, which in this country come at a very high cost. Hundreds of small businesses are having their property auctioned after failing to pay back loans and borrowings.
To succeed in business, learn to manage your cash flows. It’s best to avoid borrowing, especially if it comes at an unaffordable price.
Manage your costs A number of entrepreneurs have no idea how much profit, or losses, their businesses are generating. Having no record-keeping systems in place, no budgets and no periodical financial reports, they are operating in the dark.
It usually comes as a surprise when the business becomes bankrupt and collapses. Reduce this risk of financial failure by setting a record-keeping and financial management system.
Develop operational risk management plans What happens when your only machine operator quits; or your only sales person is sick for a prolonged period? Can you afford to employ a replacement at short notice?
An operational risk management plan will cover these risks.For example, you could cross-train your staff so that they can carry out multiple duties in case someone is unavailable. The plan will also include development of operational procedure manuals that describe the vital processes of your business.
These enable a replacement person to quickly learn and understand the processes and standard operational procedures so business can go on with minimum disruption.
If you have other strategies that you use to reduce risk in your business, please let others know by dropping them to me by email.
The 2012 Simplified Guide to Taxes for Entrepreneurs is now available. People on my mailing list have already received their free copies. If you need one just drop me an email. The first SME BusinessLink breakfast meeting is set for Friday January 27 and renowned marketing and branding expert, Nigel Jumbe, will talk about how entrepreneurs can effectively market themselves and their businesses so as to accelerate their growth.
Phillip Chichoni is a strategic business planning and financial management consultant who works with SMEs and entrepreneurs. You may contact him by email on [email protected].
