Expert cautions on investment blunders, financial discipline

Jan 05, 2015

Complacency and lack of proper business-oriented financial discipline in young entrepreneurs are the leading barriers to enterprise growth, hindering job creation initiatives.


By Vision Reporter

Complacency and lack of proper business-oriented financial discipline in young entrepreneurs are the leading barriers to enterprise growth, hindering job creation initiatives.

Entrepreneurs get themselves into investment blunders by becoming lavishly spending money generated by the enterprises.

When businesses break-even in the short-run, their proprietors embark on celebrations and give donations, affecting business sustainability.

The executive director of Enterprise Uganda, Charles Ocici, noted that the worst form of financial indiscipline among entrepreneurs is diverting money meant for business development to casual engagements.

Ocici made this observation during a recent enterprise development training session for the youth in entrepreneurship at the Imperial Royal Hotel in Kampala.

The training is part of the celebrations that marked the Global Entrepreneurship Week celebrated worldwide in the third week of November.
 

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The training took place in November last year


In Uganda such celebrations are organised by Enterprise Uganda.

“The biggest barrier to business growth is the reckless handling of finances by entrepreneurs spending money meant for the business. They thus lose the continuous desire to succeed,” said Ocici.

He added that: “Once one generates more than what he used to earn, he celebrates and makes irrelevant donations, forgetting to maintain the customer who supported the business form the start. Many have failed to establish themselves as brand names for this reason.”

Ocici added that other challenges include poor customer care, wrong choice of enterprises and lack of capital especially for the young entrepreneurs.

According to Rosemary Mutyabule, the business development manager of Enterprise Uganda, since 2007, Enterprise Uganda has trained close to 100,000 youth across the country 70% of whom have businesses that are still running.

What are you up against? (Adapted from online sources)

One of the major reasons why people find it hard to climb out of a financial hole is because they do not take the time to understand what they are up against. Financial discipline is all about knowing every aspect of your situation .

Analyse things methodically. If you owe a variety of lenders, for example, you will want to set priorities and determine how much to pay whom and how often.

Those who find themselves or a loved one in legal trouble may want to learn what might be in store for them cost-wise.

Knowledge is important, you need to honestly evaluate where you stand before you proceed.
 

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