The Business Environment It is true that the start up phase of the business lifecycle is the hardest one for a business to survive. Getting a business established will involve translating the business concept into reality. This does not, however, guarantee success in the other stages.
The start up phase of a business has many challenges. To successfully pass this stage you will need to overcome these challenges. Businesses are faced with high costs associated with establishment this is the first rocky path. Next is making sure you promote your product if not, poor customer awareness leaves you with poor cash flow ending in low profit levels. E.g. if you were to start a business selling furniture, in a location not easy to find, and you do not promote your product and location no one will know about it therefor you will make no profit.
Following the start up phase is "growth"ÃÂ.
An increase of customer awareness of the product leads to increased profit levels therefor, the ability to introduce new products. With the new products available, comes increase in employees, and task specializations by employees. If the product or products are accepted by increasing number of customers and competition is not fierce, profits will increase and the business may expand. Some businesses may tend to fail in growth, when expanding. E.g. Sizzlers expanded to many locations during growth and failed because it lost control of each outlet.
The "maturity"ÃÂ stage comes when growth tends to flatten out. More competitors tend to enter the market and market share tends to reduce. Business will need to have efficient use of resources to maintain their profit levels. Communication and management structures will need to be well defined. E.g. Before smoke mart came in strong there was a small but known privately owned...