Times Of Swaziland: 16 REASONS BUSINESSES FAIL – ESWATINIBANK PERSPECTIVE

16 REASONS BUSINESSES FAIL – ESWATINIBANK PERSPECTIVE
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Nhlanganiso Mkhonta on 09/09/2024 08:00:00


MBABANE – Unrealistic financial projections and failing to account for cash
flow are some of the many reasons why businesses fail along the way.
The EswatiniBank Micro, small and medium enterprise (MSME) department has
outlined at least 11 reasons why proposals and businesses fail as far as the
banking institution is concerned.
Loopholes
Head of Business Banking (MSME Department) at EswatiniBank Gab’sile Dlamini
said as they receive applications for financial assistance from prospective
entrepreneurs and already established businesses, they have noted some loopholes
that lead to business failure. Dlamini was speaking during the MSMEs and
agribusiness forum held at Mavuso Trade and Exhibition Centre last Wednesday. In
her presentation, Dlamini said the first reason for proposals and businesses
failing was a poor understanding of the business plan, which encompassed the
non-viability of the business and a lack of market research.
She shared that others often come with business plans developed by consultants,
and the businessperson would come without having read or understood the
documents. She said some aspiring business people often submitted business
proposals that showed less capability of living, growing, developing or
functioning successfully.She said lack of capacity (knowledge/training) is also
another reason why businesses fail. Poor performance monitoring, which includes
poor record-keeping and proper bank statements, was also cited as more reasons
why local businesses fail. Dlamini added that another reason is negative cash
flows resulting in a lack of profit.