Based on a recent report I read, 50 percent of startups fail in the first four years. 19 percent of startups fail because of too much competition, and another 18 percent fail because of pricing or cost issues. This is in good times.
In bad times, there are two outcomes. To exit and declare bankruptcy if one cannot hold the fort anymore. Or to continue, innovate and sail out of the big storm. Learn from your experience and be even greater. Both outcomes are equally painful.
Nobody says being an entrepreneur is easy. To step out of one comfort zone, be a boss of your own, takes a lot of determination, courage and strength. To start a business is easy, to sustain and ensure its long-term profitability, is tough.
It is perhaps the notion of the unknown, the risk, and the potential returns, one might get, that makes entrepreneurship exciting, rewarding and thrilling.
However, not everyone is cut out for that. One crucial trait of a successful entrepreneur is a ‘Never Say Die’ attitude. Jack Ma, was rejected by Harvard for a whopping 10 times. For one, rejection and failing are simply an inevitable part of the process. Virtually every success story entails (often multiple) stories of failure. What’s important is that like Jack Ma you pick yourself up by the bootstraps and learn from the rejection.
I cannot imagined the struggles and challenges faced by all the business owners right now. The lockdown across the globe has been ongoing for a while. Essential services are continuing and most companies have arranged for their employees to work from home. Tuition centres and Schools have transited into an online teaching delivery mode. Spas, Aesthetic clinics, Beauty parlours, gift shops, hardware shops have all stopped operations. The bare essential services are on-going to serve the basic necessity needs of Singaporeans.
One of the motivations for being an employer is the potential profits one could gain from a business. Contrast that to an employee, an employer aka boss will earn a director salary or/and choose to take the profits when the company is profitable. The returns are potentially higher if the business does well. As higher risk equates higher returns, the draw for every entrepreneur is to scale his business, employ the right employees, and get exponential earnings from the business. One could be a sole-proprietor, in a limited partnership or start his or her own a private company. All have its own financial and legal implications.
High risk also means a possibility of higher losses. How can we expect to win all our battles? Even Goliath lost to David. It is wishful thinking that we will succeed every time in business. Notable successful entrepreneurs like Bill Gates and Steve Jobs have had tasted failure many times before they could see the light out of the tunnel. Successful and high-profile entrepreneurs in Singapore has had their five minute of fame, and we don’t hear from them anymore.
I spoke to a few business owner friends before I wrote this article. The sentiment across the market is pretty depressing. Most are not upbeat and remain cautious and worried about the next few months.
I even had a chance to read one reflection written by a female entrepreneur. She has written her thoughts about covid19 and her business. In her reflection, she described how puzzled and dazed she had become, almost crippling, but she pulled herself together to think about eight ideas which she can slowly implement for her company. I see fears in her eyes just by reading her notes.
Another gungho entrepreneur friend who owns a café said, ‘KNNBCCB’ is what I am thinking right now. I am taking the time to build new capabilities for my business’. I asked him about the government measures and support and whether they are helpful, and he opined that certain policies are not foolproof. One example is the property tax rebate given to landlords. He said that there is currently no website to check the exact rebates that should be passed down to tenants.
Another friend talked about the ‘new normal’ behaviour which we are all experiencing now. ‘Client behaviour might actually change and they might want the online lessons instead of face to face, as it saves them time and money to study at home’. This childhood friend, who owns a physics tuition centre, is concerned with business continuity, and how consumer behaviour might change once this pandemic is over.
Another friend who is in the spa business predicts that his business might be affected by 50% after the circuit breaker. People might still be concerned about getting infected and reduce their time outdoors. He continued by saying that cash flow is definitely at the top of many entrepreneurs’ minds right now. ‘How do we ensure that we have enough cash flow to pay our rent, salaries, variable expenses, in the next few months’, he added.
The same entrepreneur, who texted her notes to me, made an interesting comment. She said ‘In the past, a traditional company creates a turnover of 100 million with the help of 1000 employees. In the age of technology and in current times, in a virtual world, an online company could have a turnover of 100 million with the help of only 100 employees’.
Indeed this was a thought-provoking point. The perils of technology is coming closer to home than we imagined. We embrace it so closely without knowing that one day, technology is going to take us over, sooner or later.
Look at the number of zoom calls we are making, the self-delivery robots at restaurants, automated cashier systems, chat bots, AI, VR, and the list goes on.
This is an opportune time for everyone to re-evaluate his or her life. Businesses need to re-think their business strategies , and find innovative ways to survive through e-commerce and online platforms. Self-employed and freelancers would need to think about learning new skills and possibly venturing into a second income-making model. Employees will need to think about their value they bring to their company. If you are an employee and idling at home right now, it means that you might be dispensable after all. What's fearing this group could be potentially rounds of retrenchments after CB. In any case, no one is indispensable.
So who’s the hardest hit during such periods. It is unfair to point to any group without real statistics and figures. We have heard a lot about freelancers and self-employed losing their gigs and projects during this period.
Let’s not forget the business owners. They are a courageous group of individuals who have put a step forward with meaningful pursuits. They had created businesses and provided employment to a large group of workers. They have created meaningful USPs, products and services that have impacted the lives of people and society. They have contributed to GDP and the larger economy of Singapore.
Perhaps it is also a time to re-look into how we treat businesses/ brands as consumers. Do we throw our weight around thinking ‘consumers are always king’ and demand even the slightest perk we can get from our purchase? Do we remain as keyboard warriors, hiding behind our laptops, and sending anonymous complaints around?
Let’s give them some slack and show our support during this period.
They are equally at the losing end during this covid19 pandemic.
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