In many cases, what you need to start a business is passion, but according to the U.S. Bureau of Labor Statistics (BLS), 45% of businesses fail within 5 years. A publication by Investopedia pointed to the fact that these failures are usually as a result of the Founders lack of business skills.
A related reason businesses fail at the early stage is that Founders are expected to shoulder business administration responsibilities, and their inexperience costs the business. All these show that passion isn’t enough to run a business. Entrepreneurs must acquire the necessary skills.
This post has highlighted the top business skills every entrepreneur needs. The skills are invaluable no matter the level of growth of the business.
Top Business Skills You Need as An Entrepreneur
- Communication Skill
This skill is not only important for business – it is also essential for our day-to-day living. However, many entrepreneurs don’t take it seriously. For you to see the importance of communication skill, here’s a highlight of three recurring instances where it is needed in business.
First, you need it to communicate your passion and conviction about your business to people. Second, you need it to communicate clear expectations to various stakeholders. Third, it is needed to solve problems that may arise in your dealing with employees and customers.
From these instances mentioned, you can see that communication is one of the important business skills you must develop if you want to become a successful entrepreneur. Note that communication isn’t just about knowing how to talk to people or deliver an awesome presentation. It also involves developing good listening skills, so that you can understand and analyse what the other party is saying or not saying.
- Strategic Planning
No matter how small your business is, the belief is that you want it to grow, and you have a direction you want it to go. For you to take your business in this desired direction, strategic planning is a skill you must acquire. This skill helps you define the plan and milestones that must be covered to get your business to the promised land. The skill also guides you in knowing how to allocate human and capital resources to achieve your dream. At the same time, good strategic planning lets you project your company’s future performance for up to three to five years, and also lets you develop the framework to achieve the performance.
- Leadership Skill
Once you start a business, you automatically become a leader whether you like it or not. This is the reason you must develop your leadership skill, which is the management skill needed to motivate a group of people to work towards achieving a business goal.
Acquiring leadership skills will help you learn how to take charge, assemble, mobilize, and motivate teams that will move your business forward. Beyond motivating your teams, developing this skill also assists you in your dealings with suppliers, investors, customers and prospects.
- Negotiation Skill
If you buy products or subscribe to services for personal use, you are one way or the other a negotiator – just that it is informal. In the business world, you need to learn about formal negotiation, which is best learnt through experience and practice. And like informal negotiations, the more you are involved in formal negotiations, the better you become.
Through experience, you will know what to say and when or when not to say it during negotiation. At the same time, you will learn when or when not to make concessions. As a vital business skill, negotiation is about knowing how to develop a win-win approach to all parties, while at the same time not short changing yourself.
- Analytical Skill
This skill involves the ability to objectively assess the present state of your business, compare it with projected future growth, and get data on what to do to achieve the growth. This makes the skill to work hand-in-hand with strategic planning skill.
Having analytical skill equips you with everything needed to gather, review, and evaluate the data needed to inform the decision that will influence your business growth.
- Sales and Marketing Skill
The end goal for a business is to make money, and the only way to make money is through sales and marketing. This is the reason the skill is one of the very important business skills for entrepreneurs. The skill involves knowing and understanding your target audience, analyzing your competitors, analysing the marketplace and your industry, then developing an effective marketing strategy.
The skill also involves having a seamless sales process, and everything works together to build profitable revenue streams for the business.
- Financial Management Skill
How a business manages money determines its sustainability. Therefore, entrepreneurs must know how to manage the difference between income and expenditure, as well as the risks of investment. You must know how to interpret and analyze your financial statements, and be able to determine items that are adversely affecting your profitability.
Cash flow is another essential aspect of financial management that you must learn about. You must know how to monitor, protect and control the movement of money in and out of your business. If you don’t, you may suddenly find out that you don’t have enough money to buy raw materials or pay salaries.
- Time Management Skill
In this age of social media, where almost everything is competing for our time. Time management is one vital business skill that entrepreneurs that want to progress must develop. Time management lets you know how to use your time wisely, by focusing on tasks and activities that add values to your business.
Entrepreneurs need more than passion to run their business. They have to wear many hats, as they run the business. To wear these hats conveniently and move your business forward, you would have to adopt the skills highlighted in this post.