Tuesday, August 16, 2022
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    Lesson along the way…

    There are so many businesses opening up shop in Addis that it is hard to keep track. At the same time, there are so many closing shop. And this had me thinking about why? And it keeps coming up in different conversations. When we were having this discussion with my cousin, he asked me “why do restaurants fail?”and my mind started going in ten thousand different directions and I started naming all the reasons like “the food is no longer good or the location is not convenient, etc…”. My cousin stopped me and he said, “The restaurant fails because people no longer come there.” Sounds extremely simple, doesn’t it? We had this conversation a couple of months ago and the more I think about the answer, the more my mind is blown. Your food could be bad, your location remote, but your restaurant fails only if people stop coming.

    I have identified three main reasons why I think business struggle to get into the market or stay in the market. Small disclaimer, these are conclusions that I have arrived to myself and not based on any empirical study, so do take them with a grain of salt.  

    The first thing is owners of businesses think they can do everything just because they are owners. Building a business is not easy, and it does take a lot of you while giving some major life and businesses lessons. It is tough to build a business without really putting your all into, from finances to emotional investment. Seeing your dream come to life or the fruit of your labor is a really big achievement and should make one very proud. However, there are many aspects to a business, from accounting, to hiring, to buying light fixtures, selecting dishes or selecting furniture or designing or whatever is necessary to your particular business. The problem comes when the owner feels as though she is capable of making the decisions on all of these matters. Often times, these owners are not experienced in the area that they are invested in and building a business in, so where does the confidence of deciding on all of those matters come from? I think it is because we have equated money to knowledge. This is a tough lesson to learn but just because you have the money, does not mean you have the knowledge.

    And this leads me to my second point: we do not value specialized skills. This is a problem in all aspects of life in Ethiopia and not just regarding businesses. Although we recognize that there are different aspects to a business, we do not value the benefit of having people who are skilled or trained in that area from doing the work. We consider it an unnecessary expense, something we can do without. Unfortunately, this is doing more harm to businesses than owners will admit. Take for example hotels, we have so many of them opening around the city and the moment you go into one, you will quickly realize whether the staff has been hired based on their kinship to the owners or on a professional basis. You can tell by how the waiters tell you about the menu, what the menu itself looks like, how they serve you your plates, how they react when there is a problem. It makes a world of difference, and in time where so much competition is coming into the market, it is

    We do not believe in separating the individual from the the “company”. Although legal they are two different entities, unless it’s a sole trading company but that’s another conversation for another time, the owner feels as though her and the business are one and the same. In some cases, it is great to have the owner be the face of the business, especially if that person is already famous, i.e. famous runners, supermodels, actors and the like. But we are not all like that nor should we even try to be. Yes, in many cases your business is your baby, but it should have a life of its own. The business should be a brand separate from the owner, and that means that the owner should stick to a role of “supervisor” and not manager. Management is a skill and there are people who have studied long and hard to get it, better to let them take of that.

    The biggest lesson I am learning along the way of building a business is that it is important to know what you can do just as much as it is vital to know what you cannot do. Separating the two decreases frustration and leads to a better decision making scenario.

     

    Contributed by Leyou Tameru

     

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