Ask any student in Kenya and he will affirm to have used a Bic ballpoint pen in his school years. And that has been the case for more that four decades. What many may not be aware of is that there is a name to that success and that is billionaire Chris Kirubi.
Mr Kirubi is a study in the success of the entrepreneurship spirit that is the hallmark of Kenya’s resilience in overcoming her unique challenges to be regarded as one of Africa’s top economies.
From modest beginnings, Kirubi’s Haco Tiger Brands is presently one of the region’s leading Fast Moving Consumer Goods manufacturers, supplying a wide range of products to East African & COMESA markets.
They range from food to skin and hair care products to plastics.
Starting around 1971, Mr Kirubi, according to Wikipedia, began buying run-down buildings in Nairobi and Mombasa, renovating them and either selling the renovated structures or renting them out. He also began acquiring strategic pieces of land in and around Nairobi, and proceeded to erect rental residential and commercial properties on them, using loans from financial institutions.
Apart from Haco Industries, which he briefly partly sold to a South African firm, his investments include approximately 29 per cent shareholding in Centum, 100 per cent ownership of 98.4 Capital FM, a 9.58 per cent ownership in UAP Insurance and minor interests in a number of listed firms, including Kenya Commercial Bank Group, Nation Media Group and Standard Chartered Kenya
Worldwide, there are many individuals who have started from such ordinary circumstances to become successful businessmen who have had a great impact in world affairs.
However, to achieve such success is not an easy feat. You need to have a thick skin to succeed.
Examples abound of how ambitious individuals try and fail in their tracks while trying to start a company or a small business. This is due to their insistence on trying to start a business without considering certain crucial factors.
A few lessons can be learnt on why startups fail and these lessons are crucial to every individual who is willing to start a business and rake up some cash from it.
Some o these factors include:
Management comprises of individuals in a company set up. These individuals mostly head the various departments in a company, which include human resource, public relations and administrations. The management team matters a lot. These individuals are the face of the company and if anything goes wrong they will be held liable. They need to have good communication skills which include listening, socializing with junior staff in the organization and listening to their problems and solving them and also writing skills where needed. Communication skills are crucial because if you put forward wrong information it may cause a storm or even creation of a product not supposed to be created.
Therefore, in a start up the founders should consider individuals who have knowledge about the kind of business they want to start. If it’s a small business run by only the founder, does he have knowledge about it and its running? The management should also be open to new ideas on how to run the business and avoid looking down upon junior staff in the management ladder.
Lack of market analysis skills
Most individuals start a business because they have the capital. They don’t stop to think why certain businesses are located in a certain locality and not any other place. As a clever business person, who wants to succeed in a certain venture, should consider the locality in terms of: Do the people consume what I offer? What are the demographic factors of the area that is the age and gender?
The most common example being you cannot sell pork in a Muslim settlement and you cannot start a movie shop in a place predominantly occupied by the elderly.
You cannot start a business in a sparsely populated area and expect it to be a booming business. One needs to start a venture in a place where there is enough people to consume the product you offer. If it’s a perishable product it can go bad thus making you lose a lot.
This is where startup businesses make a gross mistake. One does not solely look for money to start a business without considering that such a business needs a few months or up to a year to sustain ‘itself’ and the employees. By sustaining I mean a business is able to pay the bills, salaries and still be able to get a profit after a financial year is concluded or a month to say the least.
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A person venturing into a business should look for capital to start the business during its startup period up to a year. Few businesses manage to be self-sustaining in a few months but one should not run the risk of failure due to having less capital knowing the risks involved in that.
Starting a business while employed
Many people may disagree but the success rate of starting a business while employed is very minimal. Most jobs have a strict time policy; you must be in the office by 8am and out by 5pm. This is the time one needs to run or oversee the operation of his/her business. Juggling between a business and an employment can be tiresome and especially risky if the employees are untrustworthy. The employees may sometimes run your start up to the ground if you are not around. Therefore, an individual needs to take the risk of resigning from his job and venturing in the business fulltime to ensure its’ given the attention required. Chris Kirubi once said “Don’t be a jack of all trades and a master of none. Master one and remain relevant in it”
This is one of the factors that can completely drive your customers to a rival. Before starting a business in which you resale products supplied to you need to establish whether the supplier is reliable. You can’t run the risk of lacking the products. Customers also need someone they can rely on to provide what they want at specific times. A rival may benefit so much from your failure and may end up retaining the customers because he/she is more reliable.
Therefore, in any venture, one should analyse these factors in detail to prevent failure and lose of valuable capital, which if well utilised can be so useful to an individual or a group.