Whatever you do, do not take those business risks for granted. Of all the risks, the most ignored is the need for diversification of the business, its offerings and focus. It’s understandable why the mitigation of this type of risk is often trivialised and not prioritised. That’s because many small-business owners either focus on increasing the scale of their businesses or their specialisation, that thoughts about introducing new offerings to reduce risks to the business are not foremost.

But some owners do not even bother focusing on expanding their businesses, but are quickly excited by increased turnover of their businesses and have shifted their focus on their lifestyles. You see them working fewer hours and spending most time galivanting the world when they could be opening new branches or adding new offerings or buying new businesses to diversify their business portfolios.

While commendable that entrepreneurship enables some to have a better life, it is also easy for one small change in the market to disrupt it all and for the business to lose everything resulting in premature permanent closure. By Nimroth Gwetsa, 31 May 2019.

I really get impressed driving at night along city freeways, seeing lights of many businesses shining away and different coloured neon lights revealing company names. More impressive is seeing companies expanding their territories and new ones emerging by the road side, that it becomes clear that those companies are growing and moving from strength to strength.

Many owners have different visions for their businesses. Not every small-business owner wishes to corporitise or have presence in different locations within and outside the country. Some are more than happy with their outfits that they become content whenever they begin to consistently generate certain levels of income. It explains why some owners would then change to focus on glamorous aspects of their lives. They have earned their rewards. Let them enjoy the fruits of their hard labour in peace and as they see fit without anyone judging them.

But there are other owners one can easily feel sorry for. It becomes so apparent to notice they don’t know what they don’t know, that one day, their single or primary source of income will cease and they will lose everything. You’d wish you could take them aside by the scruff of their necks to force them to diversify their businesses, especially when the market and consumer behaviour are changing.

Though these businesses belong to their owners and these owners do not necessarily owe anybody any explanation of how they should run their businesses, except in compliance with regulatory and legal requirements, owners should consider the impact to staff, of their businesses foreclosing.

In South Africa, it is recognised that every employee somewhat cares for a few, if not several other dependants. Now imagine having to lay off staff because the primary income source offering is no longer in demand, the situation requiring the downscale or closure of the company, how many of those dependants will be affected by such action?

A business without a “conscience” in this day and era will likely face difficulties in the market and may not survive long. Thus, owners should have some level of selflessness towards others while also enjoying and doing it for themselves.

Alphabet, the holding company of Google, can provide many a small-business owner, lessons on expansion models to emulate. The company started with a single focus and is now so diversified that, though it is not immune to sudden disruption and failure, it would take something extraordinary to bring it down. The company is so fortified that its founders can afford to have whatever lifestyle they may wish to have, yet their desire to always seek something new and fresh never subsided.

Ironically, it appears the more the company expands, increasing the net worth of its owners, the more its owners do not see value in pursuing flashy lifestyles, but are becoming more interested in humanitarian causes. They seem to “get a kick” from pursuing charitable causes than spending it on themselves. At face value, such lifestyle does not seem appealing, but it looks like you’d have to be there to begin to enjoy it, than look at it from afar. They seem to have discovered the true meaning of life. And this is what keeps pushing them to want to do it repeatedly and more of it.

To the contrary, a relaxed lifestyle seems more appealing looking at it from afar than actually living it. I somehow do not believe a glamorous lifestyle brings contentment than an ordinary one. Nevertheless, perhaps there are many who can disprove this notion.

Human beings are generally creatures of habit. We tend to do the same things until we experience or encounter some disruption. The motivation to diversify the business seems less when all is going well with the business. We find it easy to give up attempts to diversify when we still earn income from our current offerings. We change only when forced by circumstances. Suddenly when we face prospects of loss, we begin to panic and it is when we are desperate that we would be tempted to do wrong things.

We should force ourselves to take those boring and hard steps of diversifying our business offerings because we know it is the right thing to do. Good things feel painful and difficult to do at first, while those bad for our welfare are easy and give a good feeling initially. Like physical exercise and maintaining good health, these are not easy to do, but once one is in the habit, it becomes easier to do. Likewise, we should force ourselves to get into the habit of forcing ourselves to work on those risks appearing too remote to materialise, yet too devastating should they occur. Such habit will become second nature and result in our small-businesses becoming large and employers of many and positively impacting on many other lives.

Pay attention to your business risks.