Main Factors of Entrepreneurial Success and Failure

Factors of success and failure of entrepreneurship are a number of variables that can support and cause success or failure of entrepreneurial activity. An entrepreneur must understand these main factors.

Points for success and failure of entrepreneurs

Factors of entrepreneurial success

  1. Human resources.
  2. Financial resources.
  3. Business organizations.
  4. Ability to manage the business.
  5. Marketing skills.

Factors of entrepreneurial failure

Thomas W. Zimmerer has put forward several factors that can cause entrepreneur failure, including the following.
  • Does not have management competence.
  • Lack of experience, especially related to the business field.
  • Lack of mold to manage and control finances.
  • Fail when planning.
  • The location of the business is less strategic.
  • Lack of supervision of business equipment.
  • A half-attitude.
  • Inability to make an entrepreneurial transition.

Explanation of the factors of success and failure of entrepreneurs

Explanation of entrepreneurial success factors

1. Human resources

The first factor for entrepreneurial success is human resources. Good for entrepreneurs or employees. Employees not only do the work, but they also influence the business. The more qualified human resources, then directly supports business sustainability. 

2. Financial resources

One of the most common mistakes made is underestimating how much money is needed to build and run a business. Some initial costs can be predicted, such as the cost of new buildings or equipment rental. But other costs are less easy to detect and entrepreneurs can fail if they miscalculate, then find themselves short of money when they need it most. To anticipate this common mistake, entrepreneurs are advised to have antibodies with a budget surplus for their finances rather than just the initial costs required.
One of the most common mistakes made is underestimating how much money is needed to build and run a business. Some initial costs can be predicted, such as the cost of new buildings or equipment rental. But other costs are less easy to detect and entrepreneurs can fail if they miscalculate, then find themselves short of money when they need it most. To anticipate this common mistake, entrepreneurs are advised to have antibodies with a budget surplus for their finances rather than just the initial costs required.

3. Business organizations

Organizational support is no less important for business continuity. This support can make it easy to run a business, namely by harmonious, dynamic and creative relationships with one another in it.

4. Ability to manage the business

The ability to manage a business is an understanding of doing business and how it can be managed. This understanding must be defined in detail, then it can be applied when the business goes on.

5. Marketing skills

Marketing deals with the target, then the right time and place. This factor is very decisive and support for business success. Therefore, marketing skills are very necessary.

Explanation of entrepreneurial failure factors

1. Does not have management competence

Not having the ability and competency knowledge to manage a business is a major contributing factor that can make entrepreneurs less successful.

2. Lack of experience, especially related to the business field

Lack of experience, be it technical, entrepreneurial ability, coordination ability, human resource management skills, or the ability to interpret the company's operations can also cause this.

3. Lack of mold to manage and control finances

In order for a business to succeed, financial factors must be maintained, that is, carefully managing spending and revenue. If not, for example, a mistake occurs when maintaining cash flow, it can hamper the company's operations.

4. Fail when planning

Planning is the starting point of entrepreneurial activities. If this planning fails, then in the next potential experience difficulties to carry out business activities.

5. The location of the business is less strategic

Strategic business location is a supporting factor for entrepreneurial success. With a strategic location can also get efficiency when the business operates.

6. Lack of supervision of business equipment

Supervision is related to efficiency and effectiveness. Lack of supervision can lead to inefficient and ineffective use of business equipment.

7. A half-attitude

Entrepreneurial attitude is needed seriously, if not so then failure becomes a greater possibility.

8. Inability to make an entrepreneurial transition

Entrepreneurs must be prepared to make changes and transitions that can occur. If this is not the case, then there is no guarantee for entrepreneurial success.

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