A young woman aged 15 won a brand new Mercedes Benz worth Ksh. 6 million in a promotion. Selling the car at a tidy amount, the lady started a vegetable farm, set up a wholesale shop, bought parcels of land and gave soft loans to friends and relatives who promised to pay back after a short while.
As the future started to look bright, pests struck her farm wiping out the whole crop. She lost her parcels of land to crafty land brokers. Her wholesale shop collapsed due to lack of business management skills. The relatives who had borrowed money from her on trust were nowhere to be seen as there was no document binding them to the deal. Five years down the line, the woman is languishing in abject poverty, with memories that she was once a millionaire.
What matters- money or sound knowledge on how to use the money profitably? Youth have dire need of vital entrepreneurial skills. The establishment of the Youth Enterprise Fund (Kenya) for example, was a noble government initiative to tap youth creativity and enable them actualize their business ideas by providing start-up capital. Unfortunately, the government has done little to train and mentor the young beneficiaries of the scheme, leading to a chain of business failures and undiscovered potential.In addition, the youth lack proper knowledge on investment and ploughing back into business profits realized.
An entrepreneur should understand current trends in business and install proper structures to combat market fluctuations. Competitor information enables entrepreneurs to understand their market share consequently making strategic decisions to gain competitive edge. It also enables one avoid pitfalls previously experienced by the competitors, while at the same time learn form their success stories.
Access to information brings in new ideas hence realizing innate potential, boosting confidence, making wise decisions, taking calculated risks and making better deals. Sources of information include the printed media (magazines, newspapers), conferences and the internet. It takes individual interest and thirst for knowledge to gain access to vital business information.
Ambition, determination to succeed and ability to make time and social sacrifices are paramount for an entrepreneur to endure harsh market conditions. Without goals, objectives and a vision to look forward to, complacency sets in, making the business to ‘mark-time.’
It is in the best interest of an entrepreneur to look for a mentor, preferably in the same business sector, who will offer advice on how to manage the business or invest the profits realized. Further, willingness to enroll in entrepreneurial classes and acquire knowledge on business management, marketing, planning and budgeting not only enables an individual acquire skills to run a profitable venture, but also new ideas necessary for continuous improvement.
Information Technology literacy is also an added advantage. It enables an entrepreneur to access the internet easily and meet new clients as well as sell products and services online. Knowledge of various software makes work easier as some processes can be automated, hence cutting down on operation costs.
Lastly, some people have the funds but lack viable ideas on how to utilize it. Networking with successful business people and ability to spot opportunities and act on them ensures that the money is put into proper use. It all depends on how far we are willing to stretch our horizons.
By Virginia Thuku
Ms. Thuku is a Commentator on Finance and Economic Issues
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