10 Good Reasons Why Small Enterprises (Small Businesses) Fail

You'll agree with me that there are so many small businesses which have contributed a lot to the growth of economy. They have created employment opportunities for many families although some remain to be small throughout their operational life.

It is obvious that those who are starting new ventures have objectives to achieve. And to mention each business has got its own objectives to achieve such as maximization of profits and sales, minimize costs, maintain a certain level of production and labor force etc.

Failing of a business opportunity is what an entrepreneur won't want to happen. Inasmuch as we agree with the fact that there are firms which have succeeded, we should also accept the fact that a good number of them have failed even before two years lapse after they commence business.

If aspiring entrepreneurs addressed the reasons why small businesses fail, then they will not fall to be victims of the same causes of failure. This is because they'll be in a position to identify these causes and fix them before it's too late.

Now you may be asking yourself as to why some businesses remain to be small throughout their operational life despite some of them making profits or are capable of growing.

4 Reasons Why Small Business Remain to be Small

1.) The owners of these businesses prefer not to expand their businesses. Some sole proprietors do not want to be bothered with the challenges of managing a big business. They don't want to employ people to assist them in running their businesses but instead they prefer to be assisted by their family members.

2.) The nature of the product/service the business is involved in doesn't allow expansion. There are people offering products/services which make it difficult for their business to grow.

3.) Lack of capital for expansion. There are small businesses which are viable and have the potential of growing but they lack enough capital. Such businesses have the challenge of securing funds from financial institutions. Lack of capital plays a negative role in hindering the growth of small businesses.

4.) Very low demand. If the business has a very low demand for its product or service, then at the end of the fiscal financial year/trading period the business won't realize profits, and if it does, it's very low, therefore the chances of it expanding are very minimal. Just to mention, realization of inadequate profits as a result of very low demand hinders the growth of small businesses.

However, there must be a starting point and as such, every business starts as a small entity and it gradually grows to a medium entity and eventually it becomes a big business entity which is either a private limited company or a public limited company. Note that a partnership business can also grow to become a big business.

Reasons Why Small Businesses Fail

1.) Wrong Reasons For Commencing Business: People who start a business for wrong reasons haven't succeeded. Just because another person is making high profits in a certain line of business doesn't mean that you will also make the same amounts of profits as him/her if you start the same business.

2.) Poor Business Management: When there is poor management of the business it becomes difficult for such a business to succeed in its operations. Finance, marketing, purchasing and selling, planning, hiring and managing employees is what most new business owners fail to execute effectively thus making their small businesses to fail.

3.) Lack of Commitment: Starting a business requires someone who is committed in ensuring that it succeeds. Neglecting the business will cause the business to fail. Many small businesses have failed because the owners didn't take their time in monitoring performance and in marketing them. Some business owners leave their businesses to be managed on their behalf by incompetent people who lack book keeping knowledge and the knowledge of managing a business.

4.) Lack of Finances: Small businesses have failed because of lack of adequate finances. Some of the owners underestimated the amount of capital required and as a result of this underestimation some ended up running out of operating capital thus ending the operation of their businesses.

There are those who have no reserves which has led them not to be able to take care of loses and disasters when they occur thus making them to quit business.

5.) Over-Expansion of the Business: This has led to failure of many small businesses. This happens when there is borrowing of too much money beyond what the business requires so as to expand the business. Moving to markets that are not profitable is also over expansion of the small businesses.

An ideal expansion is the one that is driven by customers due to their high demand for the products and services which leads to high sales thus the business experiences good cash flow.

6.) Location: The place where the business is located is critical in determining its success. Small businesses have failed because of them being located in areas that are not ideal for business. They should be located in areas that are accessible, populated with people and has demand for their products and services.

7.) Personal Use of Business Money: This is the biggest challenge facing many small business owners. They withdraw money meant to operate their businesses to meet their personal wants and needs. If they continue to withdraw money from their businesses without returning it, their businesses will eventually run out of finances therefore forcing them to end the operations of their businesses.

8.) Lack of Delegation: Small enterprises have failed due to owners not delegating some of the duties to their employees. They think that if they delegate them, then their employees will not perform these duties as they would personally perform them. When such owners fall sick or are away from their businesses, then the operations of some tasks will be paralyzed till they resume to work.

9.) Not Diversifying: Small enterprises which have only one product/service to offer are prone to fail easily compared to those that have a variety of products/services.

10.) Procrastination and Poor Time Management: Postponements of tasks which the small business owners feel to be unpleasant to perform has made the small businesses to fail. An example of such tasks include following debtors to pay their debts (debt collection).

Time management remains to be a challenge for many people who own small businesses. If important tasks like delivering products to customers, purchasing stock etc are not handled in the appropriate time, then the business will lose its customers.

Teaching English for Communicative Performance and Business Communication

It is a challenge to us English teachers to manage with our own widely differing linguistic competence the large classes of mixed ability students. Non-availability or high cost of books and instructional material are the challenges just as tests and exams seem to have become the only goal in themselves. In addition, lack of students'(and even teachers') motivation, administrative apathy, inaccessibility to electronic media, journals and books, balance between the use of mother tongue and English to ensure acquisition of communication skills, or perhaps, a better teaching-learning situation in the mother tongue and other languages, and dissemination of best English Language Teaching (ELT) practices internationally, with an e-culture interface are the new problems teachers have to cope with.

As teachers we need to work on our own affirmative action programmes, despite constraints of our situation. In order to do something new, we may have to give up the old. As John Swales says, "We may need to recycle not only our projects and our programmes but also ourselves." In fact a practical teacher should be able to operate within, what may be called, "here and now" state of affairs. It is with some sort of inbuilt flexibility and utilitarian purpose that one can practice ELT in the days ahead.

NEGOTIATING DIFFERENCES

With sensitivity for the language (to me, language use is more a matter of pleasure and beauty than of rules and structure), I would like to assert that the yardsticks of the British or American native speakers, or their standards as reflected in GRE, TOEFL or IELTS etc, or their kind of tongue twisting, are simply damaging to the interests of non-native speakers. We have to develop our own standards, instead of teaching to sound like Londoners or North Americans. Pronunciation must be intelligible and not detract from the understanding of a message. But for this nobody needs to speak the so called standardized English (that makes inter- and intra-national communication difficult). David Crystal too appreciates this reality and favours 'local taste' of English in India and elsewhere. The problems of teaching, say spoken English, relate to lack of intercultural communicative competence.

Many of the misunderstandings that occur in multicultural or multinational workplace are traceable to inter-group differences in how language is used in interpersonal communication rather than to lack of fluency in English. In fact native speakers need as much help as non-natives when using English to interact internationally and inter-culturally. It is understanding the how of negotiation, mediation, or interaction. We need to teach with positive attitude to intercultural communication, negotiating linguistic and cultural differences. The focus has to be on developing cultural and intercultural competence, tolerance (the spread and development of various Englishes is an instance of grammatical and lexical tolerance), and mutual understanding. Rules of language use are culturally determined. I doubt all those who talk about spoken English, or communication skills, care to teach or develop intercultural communicative abilities. This presupposes a good grasp of one's own culture or way of communication, or the language etiquette, gestures and postures, space, silence, cultural influences, verbal style etc.

Understanding and awareness of non-verbal behavior, cues and information is an integral part of interpersonal communication in many real-life situations, including business and commerce. Though research is needed to understand the role of visual support in our situations, it does seem relevant in making students aware of the context, discourse, paralinguistic features and culture. This can be advantageous in teaching soft skills which are basically life skills, or abilities for adaptive and positive behaviour, so necessary for successful living.

If one has to work abroad and use English with others there, one has to be sensitive to the culturally governed ways of speaking or talking to each other. The speech community's (the language culture of the group of people) ways of communication cannot be taken for granted, when one seeks to learn or teach spoken English. People fail or suffer discomfort or embarrassment in negotiations in business or political affairs, or achievement of personal goals due to incompetence in persuasion, negotiation, mediation, or interaction. It is their performance, their intercultural interactional competence which matters; it lies in managing social interaction, and not just communication, in the narrow sense of the word, or use of right grammatical form, syntax, vocabulary, or even certain polite phrases. The goal is to enable one to express what one wishes to convey and make the impression that one wishes to make, using language with a sense of interaction and mutuality.

BUSINESS COMMUNICATION

In the context of Business Communication, it is not without a sense of social business for creating value and better business outcome. One needs to demonstrate social insights, too, in the use of, say, (social) networking sites, smart phones, mobile, tablet PCs, voice mail, electronic mail, and other e-business instruments such as computer network, teleconferencing and video conferencing that are being integrated to enterprise design. This means one needs to be able to share information, discover expertise, capitalize on relationship, and be collaborative in creatively solving business challenges. One needs to demonstrate leadership and management traits, innovation, and decision-making; one needs to be able to identify oneself with the shared values and beliefs of the organization one is associated with; and more importantly, one needs to demonstrate intercultural and interactive abilities with sensitivity for change and adaptation, if one is working in a foreign country or in a multinational company.

In short, one's personal communication, both oral or written, needs to be in tune with the communication philosophy -- goals and values, aspirations and pledges, beliefs and policies-- of the organization one is working for, just as one should be able to blend with the host culture.

When I mention intercultural interaction, I point to the need for adapting to differences in life style, language, business philosophy as well as problems with finances, government, cultural shock, housing, food, gender, family etc. Although many of the people sent on foreign assignment know their (foreign) market, they are often unable to accept another culture on that culture's terms even for short periods. Sensitivity for intercultural business environment, or being aware of each culture's symbols, how they are the same, and how they are different, is important.

COMMUNICATIVE PERFORMANCE

The staff development programme of this kind provides us with an opportunity to revisit the issues related to 'communicative' teaching, in general, and business communication, in particular. If communication is the aim of English (or any other language) teaching and 'communicative' syllabuses fail to develop what Dell Hymes called 'communicative competence' and Noam Chomsky mentioned as communicative performance, we need to reflect on our classroom practices, research and materials production from time to time. Chomsky's focus was on the sentence-level grammatical competence of an ideal speaker-listener of a language, and Hymes, as a sociolinguist, was concerned with real speaker-listeners who interpret, express, and negotiate meaning in many different social settings; he brought into focus the view of language as a social phenomenon and reflected on its use as units of discourse. Socializing competence and performance, Dell Hymes also mentioned 'appropriateness', that is, "when to speak, when not, and as to what to talk about and with whom, when, where, in what manner." This concept of "appropriate use" as 'communicative competence' was accepted by Chomsky and called "pragmatic competence" (i.e. rules of use). Thus, Dell Hymes 'communicative' is Chomsky's 'pragmatic' and includes knowledge of sociolinguistic rules, or the appropriateness of an utterance, in addition to knowledge of grammar rules. The term has come to negotiate meaning, to successfully combine a knowledge of linguistic and sociolinguistic rules in communicative interaction, both oral and written.

Michael Canale and Merril Swain in various papers on communicative competence have referred to "appropriacy" in terms of 'sociolinguistic competence'. In fact, they offer another term "strategic competence", that is, the ability to use communication strategies like approximation (or paraphrase strategy, using, for example, 'pipe' for waterpipe or 'flower' for leaf to come close to the intended meanings), word-coinage, circumlocution (i.e. describing objects or ideas using "It looks like...", "It's made of..." etc when one temporarily forgets an exact word), borrowing including literal translation and language mix, appeal for assistance, ie. asking for information appropriately using "Excuse me," "Could you...?" "What's the word for...?" "I didn't know how to say it," etc). mime and all that. Their strategic competence(Canale and Swain) refers to the ability to enhance or repair conversations and means the same as Chomsky's 'pragmatic competence' or Fluency. Brumfit and others too have used the term 'pragmatic' in the sense of fluency.

Thus, communicative competence consists of LINGUISTIC competence (ACCURACY), PRAGMATIC competence (FLUENCY), and SOCIOLINGUISTIC


competence (APPROPRIACY).

The Linguistic competence or Accuracy in communication is much broader than mere grammatical competence; it includes the linguistic domains of grammar, vocabulary and pronunciation as well as the linguistic skills of speaking, listening, reading, and writing, spelling, discourse (particularly interconnections and interdependence of the sentences and paragraphs), and the ability to contrast with the mother tongue.

The pragmatic competence or Fluency in communication relates to ease and speed of expression, i.e. how to keep talking, how not to remain silent because one doesn't know the word (the skill of paraphrasing), and other strategies of learning, including how to listen to oneself and so be able to self-correct and self-edit at once; that is, the ability to monitor immediately.

The sociolinguistic competence or Appropriacy includes varieties of text types (stories, dialogues, non-fiction passages etc) and functions of the language, different levels/degrees of formality or informality, or appropriacy and use of language in authentic situations.

I doubt if we follow such a communicative curriculum with understanding of communicative competence in terms of linguistic ability, pragmatic ability and sociolinguistic ability. But its adoption should help students become independent learners; it should equip them with linguistic forms, means, and strategies that would help them overcome communication difficulties both inside and outside the classroom. From this perspective, communicative competence should be thought of as communicative performance just as a communicative syllabus should be essentially performance-based, that is, increasing the learner's proficiency.

To quote Brendan Carroll: "The use of a language is the objective, and the mastery of the formal patterns, or usage, of the language is a means to achieve this objective. The ultimate criterion of language mastery is therefore the learner's effectiveness in communication for the settings he finds himself in."

POOR COMMUNICATIVE PERFORMANCE

Work-related skills such as team work, cultural awareness, leadership, communication and I.T. skills are as vital as academic achievement for Business/Management students. It would be poor communicative performance if, for example, someone makes a multimedia presentation without knowing how to use the equipment and experiences technical difficulties, or "tries to liven up a dull topic merely by adding flashy graphics rather than by improving the content of the presentation. People who attend meetings unprepared waste others' time. People with poor listening skills frustrate those who have to repeat information for them. Those who make inappropriate grammatical or vocabulary choices embarrass themselves and those around them. Incompetent communicators hurt the organization they represent. This has especially been the case with hastily sent emails composed in a moment of anger."

POSITIVE ATTITUDE NEEDED

Academic or professional communication skills, both written and oral, have to be imparted in such a way that students in their contexts are able to identify their own language learning needs and to set their own language learning goals. At college and university level, teachers may act as facilitators, just as they would need to teach with positive attitude for inter- and intra-cultural communication, the skills of negotiating linguistic and cultural differences.

It is with this sensibility for English language and its teaching in various contexts that I speak to you. Yet, as I say all this, I keep in mind the ground reality: that is, poor literacy skills, fluency, and even comprehension; poor communicative ability, with limited experiences in writing, speaking and listening unless, of course, teaching of English as a Second, or additional language improves from school level and need for a supportive classroom climate and positive student attitudes towards learning at post secondary level is recognized. Also, both teachers and students need to be aware of what to do, how to do it, and when and why to do it, as part of practicing self-regulation strategies.

The English Language Teaching community as also the other stake holders in the country should, therefore, revise and reformulate appropriate strategies and policies, with tolerance and multilingualism at the core, to remain relevant in the coming decades. The objective of looking back is to move forward with a reasoned perspective for taking measures to develop communication abilities and higher discourse competence, with a broadened inter- and cross-disciplinary bases, for learning to understand (rather than memorize) and apply in one's own contexts.

COMMUNICATION IN BUSINESS

The digression apart, let me now come back to teaching communication in business. In terms of ESP, we should be aware of the 'specific purposes' of what we do in the classroom, just as we should do it in terms of students' specific needs. For example, if we teach written communication, we teach it in the specific context of Business, maybe, where applicable, in terms of 'rhetorical functions', with a sense of logical organization of knowledge or information, as noticed in actual use. Students need to be exposed to range of authentic report material from business, commerce, finance, administration, marketing, production, personnel etc. They need to understand the logical steps in writing a report, from 'collecting the information' through to 'summarizing' and 'appendix'. In short, they need to be presented with task-oriented activities that are both challenging and authentic in the field of business: they need to be forced to read and think about the content of the report; they need to be made to think about the structure and organization of the report; they need to think about the language used to express the content; and they have to be made to apply this knowledge to the skill of writing a report. The variety of writing exercises may include paragraph writing, expansion of notes, completion of paragraphs, sequencing of sentences into paragraph, and using the right punctuation marks, connectives, sub-headings, presentation of non-verbal information or transfer of information from text to diagram (graph, chart, table, outline etc); linking findings, conclusions and recommendations, extracting main points for making descriptive and evaluative summaries etc. We teach all this in terms of what the students already know and what they need to know. They unlearn, learn, and re-learn, both formal and informal expressions, within the conventions of the discipline they belong to.

As I already said, their career success depends on good writing and speaking skills, along with proper etiquette and listening skills and understanding skills. Skills that need particular attention are informational and analytical report writing, proposal writing, memo writing, letter writing, oral presentation, and a sense of grammar, punctuation, word, sentence and paragraph.

The methodology should encourage students to learn from each other via activities both of a productive kind and of a receptive nature. We may exploit developments in the case study approach, use role plays and simulations that place the students in realistic and stimulating situations to create spontaneous personal interaction and creative use of the language in a business context.

A mix of the task based approach, group work, and simulations should help the future business people develop the skills for meeting and negotiating as also for the necessary mastery of English for functioning autonomously in the field. The challenge is not to teach a descriptive course on discourse, but to provide for a pragmatic and custom-tailored input, ready for processing by the learners in an authentic learning environment.

In other words, in stead of mere 'business communication', the emphasis has to be on, what I already mentioned, 'interaction in business context'. It is not merely the language of business, but also the cultural conventions of meetings and negotiations in an intercultural setting that one has to be aware of, and learn. As far as teaching is concerned, it is rather helping students with learning how to learn, how to create the learning opportunities for themselves, and understanding the ways in which language and business strategies interact. If we follow a learner-centred approach, a three-step procedure could be: first, to illustrate (=a good model), then, to induce (=induction for effective learning by the learner), and finally, to interact (=the outcome).

I would like to quote Christopher Brumfit from his opening speech to SPEAQ Convention in Quebec City (in June 1982): "...Being communicative is as much or more a matter of methodology as of syllabus or materials, and methodology is something that teachers are uniquely qualified to contribute to. We should therefore be willing to use our expertise, to innovate, to improve, to inform each other, and to criticize." What we are doing here, friends, is just to make a beginning, the beginning of a process of communicating, of understanding, that we can start but cannot finish.

ECLECTIC APPROACH

I am aware that there is no universal teaching method or ideal teaching material suited to many contexts of language teaching. Whatever didactic techniques one knows without excluding the behaviouristic drills, and practice and use of mother tongue, where appropriate, are all valid at different points in the teaching process. I stand for an eclectic approach as different methods for different students have always worked and there has not been one best method any time. With our freedom to choose and adopt any notion that serves our teaching ends, with a reasonable degree of historical sense, flexibility and adaptability that allows us to select among a variety of approaches, methods and techniques, we can meet the challenges of today and tomorrow. I see teaching communicatively essentially consisting of an eclectic methodology which incorporates what is valuable in any system or method of teaching and refuses to recognize bad teaching or defective learning. In any educational setting, sensitive and sensible application and continuing evaluation of the chosen practices should be inbuilt.

English has been practised in a social, economic, political, educational and philosophical "hot-house", to use Peter Strevens' expression, and the hot-house in India differs in quality from state to state. It is necessary to create an enabling environment - managerial, administrative, institutional, academic, and curricular-to promote not only quality education and effective learning with exposure to lots of natural, meaningful and understandable language, but also genuine communication. This means learners should read and listen to live language; they should speak and write it in ways that can be understood by educated speakers everywhere. Moreover, they should eventually be able to produce and comprehend culturally appropriate natural discourse.

SUMMING UP

To sum up, we as teachers need to recognize the changes that have shaken all human conditions with new technology, new social structures, new values, new human relations, new functions. As Young Yun Kim notes: "The complexity, diversity, and rapid pace of change makes us 'strangers' in our own society." The challenge is, to understand the "sameness in differences" for international/intercultural exchanges, or learning business negotiations and written communication. Language teaching alone may not develop communicative abilities in business English unless we realize that learning the language implies learning the culture also-one's own culture and other's culture. It is language and culture teaching together and sharing the "us" and "them" differences to reflect on one's own culture from the viewpoint of an outsider, and thus, become less ethnocentric and more tolerant of the values of the foreign people and their ways.

The ESP of business communication seems highly culturally biased and value based, even as Western ethno-centricism, including the North American, may not be the answer to our communicative difficulties. But we have to be OPEN to all local peculiarities to communication and interaction. If we view English as the lingua franca for business negotiations, we should also not forget that it is NOT the mother tongue of any or most of the negotiators. To that extent, the English used is commonly a variety in which the mother tongue interferes not only phonetically and phonologically, but also in the cultural norms and attitudes expressed by the speakers. To quote Susanne Neimeir, "Their non-verbal behavior, for example, does not automatically switch to an 'Englishized' non-verbal behavior but normally stays rooted in their home culture. Thus, even when they think the negotiation partner should have understood (verbal and non-verbal) signs they are using, misunderstandings still occur because signs may be differently encoded-and decoded-on the other's cultures or may not be noticed to be signs at all."

Key Small Business Tips for Success

Small business tips for starting your own business can put you on the path to financial success.

The SBA says that the term small business includes concerns that are organized to make a profit and have fewer than 500 employees. In this post, small business includes work at home, affiliate marketing, network marketing and online home based businesses, and I will explore small business tips to help you achieve your business goals. These tips will help you get customers and generate more sales quickly.

Here are key small business tips and questions to consider:

1. Why do you want to start a small business? Starting your own business requires commitment. So, don't proceed to do so unless you are prepared for long hours and frustration while you are establishing your business. For many, enduring this is well worth the potential of financial security.

2. Will you market a product or service? A service business is one where you offer your expertise to clients. For a product business, you will need to offer a tangible product. Typically, a product business is more expensive to launch than a service business.

3. Do you have a simplified business plan? The thought of writing a business plan is intimidating to most aspiring entrepreneurs. However, it is possible to write a one-page plan that tells the what, who, how and where of your business. You should keep it simple. You can add details as you go. Just get it started.

4. Who is your customer? Describe your target customer in as much detail as possible. Know their needs and wants. Know how you can provide a solution to their problem. This profile will help you create a targeted marketing message and save you time and money in reaching prospects.

5. What is your pricing? Pricing is an art and a science. You need to cover your costs and generate a reasonable profit. Doing research to see what your competitors are charging can help.

6. Are you watching your costs? Many entrepreneurs tend to underestimate how long it will take for their small business to turn a profit. Don't burden your business with too many costs too quickly. To keep costs to a minimum, hire interns and outsource or barter for services.

7. What's your plan for getting customers? One of my coaches says the secret to business success is spending 85% of your time doing things that will lead to sales and 15% of your time doing everything else. You'll need a marketing plan. How do you plan on attracting prospects and converting them to paying customers? Design your advertising to generate sales. Your advertising should always include an offer and an easy way for prospects to respond.

8. Are you using social media? More and more businesses are moving to social media because their prospects are on social media. Only about 25% of small businesses are using social media to build their business. So, creating a presence on social media will give you an edge. This typically means building a fan page on Facebook. There are many resources you can use to build a fan page.

Here are some small business tips to attract more customers online:

1. Be sure to add local content targeted for your specific area.
2. Make sure prospects can find you online and offline.
3. Be very clear about what your business offers.
4. Participate on social media consistently.
5. Watch what your competitors are doing. See what is working and what is not working.

These small business tips require you to be consistent. It takes persistence to establish a social media presence.