Walk along any street and consider that each business establishment represents an untold story of someone’s dreams and aspirations. The statistics suggest that for each business that is standing, there are 9 that have failed … closed their doors … gone bust. That failed business is a representation of the smashing of another person’s dreams and aspirations. Businesses which survive, do so because of someone’s courage and passion to persevere despite the odds. For a limited number of persons in our society, entrepreneurship is the most natural thing to do because they grew up with business being discussed around the kitchen table. If it was not about the impact of the weather on crops, it was the impact of strike on the port or the impact of the walk out by customs officers.
Some entrepreneurs grew up to the hum of business and while no one was saying you have to become an entrepreneur, the spirit of entrepreneurship was so pervasive that they made an automatic choice at the appropriate stage of their lives. Their mindset was conditioned daily to think of business and to seek solutions to business problems. Conversely, they were trained to see business as a solution to problems. There is the story of a business being spawned because of a mother’s need to import suitable foods for her lactose intolerant child.
Additionally, this small grouping also has access to easy funding simply because of who they are and the resources that are available to them.
But what happens to the other hundreds of persons who choose the role of entrepreneurship? It is a long, treacherous pot hole filled road which requires careful navigation.
There are 3 huge “pot holes” to be navigated: Self Doubt, Cash Flow and Bureaucracy.
The first pot hole is called “self doubt” which is reenforced by everything some people have been exposed to or learned. It begins in school where young people are encouraged to absorb and regurgitate so that, by the time they leave school, they are still asking what to do and when to do it. The thought of taking the initiative and making decisions is just not second nature. This mind set is even more paralysing because of the risk the entrepreneur is about to take by striking out on her own. And as if personal self doubt is not enough, the business person then has to cope with employees who want continuous direction in order to get anything done. There is no easy resolution to this problem because this attitude of “self-doubt” exists at all levels from top business executives, government officials all the way through to the bottom rung of the organization. This need for direction will take a long time to be changed.
The second pot-hole is “money”. Your first approach to the bank is likely to result in anxiety because of what is required just to open a business account. If you have cash, then it’s easy but if you need funding then the business opportunity can easily pass you by before the bank approves the overdraft or grants the loan. As a result of this level of bureaucracy and red tape, small businesses typically obtain their funding for start-up and early stage growth from a combination of the founder’s savings, credit cards and investments by family and friends. In several cases, the entrepreneur and or directors will even cook up a story to take a personal loan. These factors make for tremendous insecurity. Despite the hype and high profile media coverage, very few small firms secure venture capital funding. Banks, by the very nature of their business, are resistant to the high-risk loans which many small businesses represent. Additionally, potential entrepreneurs often lack the business savvy to be able to articulate what they need using business jargon. They are also often inexperienced in presenting a well-thought out long-range alternative plan to cover emergencies and other contingencies. All of these factors lead to the slow response by the financial sector to small businesses. There is really no easy solution to the pot hole of “money”.
A third pot hole is the one called “bureaucracy”. With a low threshold of $250,000.00, the small business is required to function like any multi million dollar business. The business must become VAT registered, pay National Insurance, PAYE, Green Fund and Business Levy. This just adds layers of institution and bureaucracy requiring an accounts department if only to keep on top of the forms. Ironically, this figure is less than what some top CEOs earn so there is a need to reconsider and really ask the question: “to what extent is this a barrier to entry into the small business sector”?
A fourth pot hole and one which might be unique to Trinidad and Tobago is the continued and unrelenting rise in “crime”. Nearly every business has been affected by crimes such as housebreaking, larceny, violent crime, road rage and white-and blue-collar crime within businesses. To my mind petty crimes upon the business include using the stationery for non business related purposes; staying in the office until late to prepare for an examination and using the resources of the business for any non related activity. Oh no! You may cry, that’s not a crime, but it is!
Incidents of crime impact the psyche of the organization and all employees. If we are to achieve the goal of a highly productive society then, we must be able to maintain a crime free environment.
Everyone thrives in an environment where people trust the system, where people genuinely live the notion of an honest day’s pay for an honest day’s work. Despite the size of the business, it a remarkable kind of person called the entrepreneur who has kept her doors open despite the odds. Small businesses far outnumber big business. The time has come for more emphasis to be placed on the needs of the small business because ultimately, the small business is in a better position to respond to the fast paced changes in our communities.