STARTUP BUSINESS REVIEW.
ELECTION FEVER AND “NO CASH” ECONOMY CRIPPLING STARTUP BUSINESSES AHEAD OF CHRISTMAS.
The joy of festive seasons, especially Christmas is the “cash season” for most businesses to engage in high sales and promotional activities to make up for some losses in the early parts the year. Not only are startups businesses affected by the bad economic situations and electioneering month a few days ahead but consumers are as well affected.
When consumers are unresponsive to products and services in the markets, how do startup businesses smile ahead of Christmas?
Some few years back, with a month to Christmas, major markets and business centers were busily making huge sales and profits. Startup businesses were not as “booming” much as it is today and Seasonal businesses are neither experiencing the usual “H to T” competition in the markets. If there’s no cash, consumers have no purchasing power and businesses have neither producing power.
We (my team) took a long tour through the major seasonal markets in Accra, where we expected to see startup businesses “counting some cash”, but we encountered no businesses and slow businesses . The popular Christmas Carols and local festive tunes are yet to be played in the corners of every market or maybe long forgotten.
Do you remember the loud sounds of Ghanaian high-life oldies played in almost every corners of Accra a few weeks to Christmas and promotional trucks and sales jam on some popular streets? It’s a few weeks to Christmas, have you yet heard any?
Here’s what we experienced in the startup markets ahead of Christmas
Firstly, the question is ; Where are the markets?
Usually during Christmas season, consumers would love to have new clothes, shoes, jewelries and the individuals primary needs. What do our startup fashion industry or markets have for us this Christmas?
Nothing? Absolutely not!
The fashion markets.
This is the slowest of all the consumer markets. There are quite some goods available but unavailable due to “no cash”. With a special attention to the local startup fashion markets where a lot of Ghanaian startups are trying their creative lucks and many of which have not yet experienced the “boom” season expressed their mixed business moments ahead of the season.
There are actually, quiet a lot to buy from; beautiful Ghanaian fabrics, Ghanaian designed wears, bags, shoes, you just name it. The Beauty industry or market isn’t an exception. The cosmetic (beauty) markets have quite an upper hand where sales margins are concerned.
Other startup markets have higher market margins because of its necessities to consumers.
Let’s look at a few geographical locations of consumer markets.
These markets below have experienced same low profits and sales margins attributed to economic hardship. Our startups in these markets, have similar stories. Quite a number disagreed to the fact that, the upcoming elections had any influence in the markets but shared same opinions of economic difficulties.
Osu Arts market
We also noticed a high rise in commodity prices as compared to the past quarters of the year. Commodities are available in the markets just as mush as products and services in other markets except for the cash to buy – “no cash”
What are the startup business owners saying?
Startup business owners expressed different opinions and views with regards to current state of their businesses and here are some few sampled views. (Startup owner “a” represents the view of a startup business owner in Accra, names are withheld. Opinions expressed are solely their concerns and worries). Startup business owners were asked the state of their businesses and how they are looking forward to “ Christmas business boom”
Startup Owner “A”
I’m a fashion entrepreneur. I will be lying if I tell you, things are selling and business is booming. I have not sold any of the things you see here since October. Yes! Since October. I took a risk to borrow some extra funds to buy fabrics to make these bags and clothes but I’m disappointed because my clients have not been able to return to buy new ones. Things are really hard. Clients who purchased on credit are yet to pay. Others will order for customized items and will never turn up for them. When you call to demand payments, they complain bitterly about the economy. The economy is seriously terrible and really not helping our small businesses. Elections have made things even worst this year but we are hopeful. Who knows, the story could change.
Startup Owner “B”
I’m into apparels. I buy them from the states or sometimes from China. I have brought in lots of goods this month because I know it’s Christmas in a few weeks. Customers only ask of the prices and tell you they will call back and that is it. I have not had any major sales yet. I just started a sales promotion to clear all these goods before the end of the year but still, I’m yet to see anything. The government needs to support us. Things are hard.
Startup Owner “C”
I am a caterer. You know around these time of the year are when we have lots of functions and people make orders. The truth is people prefer to do drinks instead of heavy foods these days. I realized it’s the trend for healthy living attitude people are adapting to lately. During functions, they would prefer just liquids like juice etc. I’m not saying it’s bad but things have changed. No matter how much you brand or advertise, things are just not the same like when I started this business. People prefer to cook home themselves and manage their costs. It was much appreciated but not so much anymore.
Startup Owner “D”
I am not in the Christmas mood at all. I have a lot of debts to recover from. No matter what I do, things are just the same. Yes, the economy is not cool and maybe because this year’s election have also brought some tension. It’s affecting business badly. For me, there’s no Christmas because I haven’t seen good money in a very long time. I’m actually on break right now to re-strategize and resume next year. I have to find ways to be debt free.
What startup consumers got to say ( Consumer opinions )
Consumers also do have a say regarding their purchasing power which have left huge frowns on the faces of our startup business owners. Here are some sampled views of startup consumers. (Consumer “A” represents consumer and opinions are solely theirs). Consumers were asked what their views about startup businesses are and if they would purchase goods or services from the startup businesses for Christmas this year.
Startups are doing well I must say. They have brought variety to the markets for us. The problem is not them. Things are very expensive these days so everyone is trying to manage. If I have enough money, why not, I would love to buy something for the Christmas but unfortunately, there is no money.
Hahaha! Do we still celebrate Christmas? Okay, I have not really seen much of these startup businesses but I know there are small businesses. I don’t think most of them are running like a normal business so we don’t really feel their impacts. The few I know of are the designers and photographers. That’s all I see about who startups are.
The economy is hard so no one is planning for Christmas, it’s the election that has overshadowed everything and it’s normal. As for startup businesses, I support them because I have friends who have started their own businesses. The major challenge is, there’s less cash to purchase anything in which ever form it’s presented.
Some of the things they make to sell are not of standards or quality. Most of them just want to be rich so they start businesses. I wish they can do better. Recently had a bad experience with one of these startup businesses and I didn’t go back there again. Because they think they own businesses, they become rude and arrogant to us because we want to buy whatever from them. Even the year is slow and we all saving up for next year. Nobody knows what will happen after elections so no buying unnecessarily for Christmas.
Startup business owners have expressed their concerns about the economic conditions towards their businesses and the supports they need for their business survival. Likewise, consumers also shared their views of startup businesses and their ‘no action’ because of no cash.
From our findings, we are certain startup businesses will have no Christmas or a little “Christmas cash” in their pockets due to the “no cash” economy and a little impact of the December elections..
Either ways, it is no Christmas for the startups.