Aldain Reid
Contributor

In the last article we dwelled on various aspects leading to fall of small businesses. Here are some things to avoid, specially in these days of number crunch. Keeping these tips in mind, one can overcome the odds and see the business graph going on the upswing.

Undercapitalisation
Many businesses fail due to the insufficiency of funds required for operating during the first few months of starting up. If you consider that there is usually a period that start-ups will need to get going financially, then you should recognise that underestimating how much money you will need, will put your business at risk of early closure. This phase of the business is often compared to an airplane runway. Far too often, we run out of runway, before the businesses are able to take off. Of course this invariably leads to disastrous consequences.

Inadequate planning
Having a coherent business plan is critical to the success of any business. Many businesses fail due to insufficient business planning. Your plan must reflect an accurate and comprehensive picture of the present situation and realistic projections for the future. Areas covered by a good plan include; company vision and critical success factors, financial analysis (capital requirement, sales forecast, cash flow analysis, and income statements.), human resource requirements, marketing and promotions and competitive analysis.

Improper management
Studies have shown that one of the most common reasons for business failure is poor management. Without the relevant business management skills and expertise, the business is likely to fail. Business owners, who recognise their shortcomings and seek help, can increase their chances of success.

A good business manager carefully studies all aspects of the company's operation, and creates an environment that encourages maximum productivity.
From hiring the right team, to crafting a strategic vision, to making the vision a reality, sound management is key factor of the success of your business.

Consider these few tips and business success could be well within your reach!

Aldain Reid is as serial entrepreneur and currently serves as the President of the Young Entrepreneur's Association of Jamaica. He may be contacted via his entrepreneurship blog at www.aldainreid.com