There must be something horribly wrong when nine times out of ten a black-owned business is likely to collapse in its infancy, that is the period between eighteen months and three years since establishment. This is in sharp contrast to businesses owned by their white counterparts.
But numerous surveys indicate that, on average, 60% of the causes of the collapse of black-owned businesses are mostly self-inflicted. The following are the most elementary mistakes that are committed:
- Difference between revenue and profit
Good people remember this point and recite: revenue is not profit and profit is not revenue. Mixing the two is a recipe for failure.
- Personal and business funds
Draw a line between personal funds and business funds. Don’t ‘borrow’ money from your business account and tell yourself that you will ‘pay back’ later.
- Performance, performance, performance
Work your socks off. Don’t entertain procrastination – finish today’s task today. Postponing something for the next day, results in an insurmountable backlog.
- Sticking to plans
Your vision might looks good on paper, but what endeavour do you take to apply it? Make sure you stick to what you set out to achieve. It’s that crucial difference between success and failure.
- Pay suppliers first
They say pay yourself first, but rather pay suppliers’ first. Have you heard about biting the hand that feeds you? Suppliers no matter how modest they amount owed have to be paid first.
