Business Life Cycle

Question 1

What is the life cycle of a small business to an entrepreneur?

Answer 1

Idea
Start-up
Growth
Maturity
Decline

Question 2

What happens at the idea stage?

Answer 2

A business idea is a concept that can be used to generate revenue, it comes from identifying a problem and proposing a solution to it, that can be developed into a business.At this stage the business idea is studied, analysed, developed and refined.

Question 3

What happens at the start-up stage?

Answer 3

At this stage, the company or business has gained legal personality and has its own bank account, equipment, employees, management team, etc. It now needs resources and efficient management of said resources to keep functioning.

Question 4

What happens at the growth stage?

Answer 4

This is when the sales, income, and cash flow in the business are positive. Meaning at this point the business has become profitable

Question 5

What happens at the maturity stage?

Answer 5

At this point, the growth of the business has become stable, and it now plays a start part in the market/industry. The business can now diversify its, activities and be innovative once more.

Question 6

What happens at the decline stage?

Answer 6

This is when the business fails or comes to end due to any number of factors or resons

Question 7

What are the causes of failure for a small business?

Answer 7

-> Poor finanancial Management
-> A lack of demand
-> Competition
-> Failure to adapt to a changing industry
-> Weak business plan