Why shortcomings are important in business
Starting a business involves an aspect of trial and error. By this I mean to say the opportunity for diversification can manifest itself in a number of different ways, not all of which end up benefiting your business. When talking to Sadie Reid, founder of digital health and wellness magazine Hip and Healthy, she explains overcoming failure through experience; how sometimes one needs to fail in order to properly understand their business. “Failure is just the best way of learning” she says as she describes expanding her own magazine too quickly, delving into the unknown territory of retail. Although profitable to begin with, the over-saturation of the market led to a decrease in margins which resulted in a lack of profitability. Despite the setback, this realisation led to a readjustment within her company and streamlining it into the successful business it is today.
Nothing can prepare you for failure
Over-exposure and expansion are common causes of business failure, with 20% of new businesses failing in the first year; 42% of which due to a lack of market need for services or products and 19% of businesses being outcompeted (Fundsquire, 2021). For this reason, diversification and scalability are important factors of business growth, but also come with a great risk factor. In spite of research and charts and many, many excel spreadsheets, trends can be unpredictable, meaning an important aspect of business growth is learning how best to fail at it.
Failure as a positive
“Fail fast, early and quick” is the advice Sadie was given. This, however, is not always possible. Instead, she stresses the importance of reframing how one considers failure: maintaining a sense of control and being able to look at your company, understanding where its value lies if and when you fail. This angle can often only reveal itself once other aspects of your business are shed. Striking out on one's own is often a daunting prospect, especially when it follows the departure from a well-established career. However, the important realisation is that others aren’t looking at your work under a scrutinous eye in order to catch when you falter, but rather the community of entrepreneurship means that they revel in your success and can even aid you when there is a dip. Seeing failure as a positive lesson is the only way to maximise the potential of your business and become successful in an environment where tens of thousands of businesses are founded annually (ONS, 2021).
As Thomas Edison put it best “many of life’s failures are people who did not realise how close they were to success when they gave up.” So, don’t be put off by your failures and keep moving forward to your success.
