With the mini and micro businesses being a large part of Filipino and foreigner lives here I just wanted to run through some of the reasons that cause failure but at the same time its not a complete list and please feel free to add to the comments.
Here is a list of the top ten causes why businesses do not succeed:
1. Lack of enthusiasm and passion
This issue isn’t always directly linked to staff as often its the fact that the owner gives up on it hoping that they can find someone else to do the work for them. In a competive market place and a world that is ever changing the only person who can drive that is more than likely yourself. You lose interest you will find your staff will quickly follow.
2. No strategic planning
Developing a strategy not only gives you insights into where you want your company to go but also gives your staff direction and goals to work to. A bit of time each week set aside looking at how you can improve and develop is key to success. The West is currently ignoring customer service in a lot of services which will no doubt have an adverse affect in the future on their businesses. Planning how you can profiteer out of such an issue is one way you can improve your business model better than your competition.
3. Under funding
If your going into business you have to go in looking to be better than everyone else. Pushing the boat out and grabbing new clients. I have heard here in the Philippines from several businesses previously “we have enough customers we don’t need new business”. Truth of the matter is that was before the recession, they may have been at capacity but it doesn’t mean there is no room for expansion or spending extra to get employees to do overtime so that they can take on extra workload. Invest wisely you will reap the rewards. Good opportunities only show their heads once miss it and you have missed that client for life.
4. Misuse of assets and resources
All assets should be working for the company. E.g. the company cars are for “COMPANY USAGE” the computer in the office is for working not browsing Facebook, there are a lot of reasons why things need to be used properly besides the obvious that if its an asset many people see its “free” not that its an item that is supposed to be productive and working for the company not a personal gain with no expenses.
5. Poor marketing
Marketing is probably the hardest and most badly done in the Philippines. Generally people have a trend that doesn’t match the West so picking your audience wisely to maximise potential and marketing not only goods and trends to them but also being very clear on things like stocks, prices etc. so you can offer a service that you will get known for and be flexible. Every business is different and every business needs to look at their marketing closely to adapt it to their needs.
6. Inability to evolve
Many businesses I have come across in the Philippines are stuck in a time warp. The world is moving on and they haven’t even thought of never mind tried to catch up. Its an opportunity to break into old markets that haven’t seen the light. At the same time be aware of how you can constantly develop to suit your customers needs and trends.
7. No direction
A lot of businesses are not set in a direction that says where they are going. Could be setting goals or planning to go from a single outlet to a complete chain. Either way its also important to do this to offer the route of a career to your staff as well as being able to search for potential growth and building a future.
8. Untrained personnel
One of the most overlooked things I see worldwide these days is staff training especially with frontline such as people handling cash registers or receptionists. But even in the large corporate world I have seen the development of arrogance with senior managers avoiding their own work by offloading it onto less trained staff as well as avoiding their even most simple of duties such as getting back to clients. Its a trend that is going to be here a while so why not change it? Always hearing about how someone couldn’t do something or how badly the service was somewhere else? how would you feel if it was people talking about your business? Truth of the matter is you need to train your staff well and at the same time develop a platform that can show improvement that way your staff also have something strive for.
9. Lack of client and customer care
Customer is “king” was a saying.. most companies these days seem to be searching for binding contracts to lock people in for as long as possible why? because service is DIRE same as customer care. This is giving rise to opportunity to do it a lot better. Putting customers first not only builds loyalty but increases profitability. Could be as simple as calling clients every couple of weeks if dealing with wholesale just for a chat. As business could be slow at the same time its good to build a relationship with the clients and no doubt they would pass on information about any sales visits from your competition. Customers should always be put first and doing so will lead to a business that can prosper.
Giving up is probably the biggest reason of all. Businesses need time to develop and building a client base is often demoralising and you sit wondering why am I doing this. But at the same time you need to go back to motivation and knowing you can make it work what is wrong with what your doing, is it improving, how can I improve my techniques, am i doing something wrong? There are a lot of reasons but the most important one is to stick at it and if you do you will be able to build your business up.