Student Entrepreneurs- Why They Start their Own Businesses
FIVE years ago after Tate Jordan completed his major at New York University with a Business Administration degree; he decided to start a shoe company. During this time, Tate had accumulated over four thousand student loans in debt. Financial constraints in catering for the loan and management of the shoe company led to the failure of the business within the first year of inception.
“The small profit that I accumulated from my business went to pay my loans”. Mr. Tate said. “Failing in the business was disappointing since it seemed like a waste of resources and energy”. Tate spent the next weeks and months contemplating what he had done wrong to facilitate such a loss. Tate began to doubt his entrepreneurial skills.
While wallowing in debt, Tate received criticisms from his family telling him he should get a job, but he considered his other career options. Since he had exhausted all his personal savings on the shoe company, Tate considered a third party, his uncle, to help with his pick-up truck for his new venture. Tate’s new business idea was distributing groceries from the farms to the local urban vegetable shops.
The new venture prompted Tate to be extra careful to mitigate losses to avoid the previous business venture’s repercussions. Tate strategized on finding a niche; reduce overhead costs, and becoming more diligent when conducting the distribution business. As noted by Jessop, (2017), student entrepreneurs with a niche achieve success. To maximize the opportunity, Tate created some videos and pictures to market his products (fruits and vegetables) he would be supplying. He also visited numerous farmers to receive alerts when the product is ready for market. Strategically, he positioned himself next to the town vegetable market to enhance business communication with potential clients.
Gradually, the business started making small profits allowing him to cater for fuel expenses, car service, and personal consumption, hence few cash to save. Tate states that the grocery business is seasonal depending on the product in the market. Therefore, to ensure distribution throughout the year, Tate had to seek various types of groceries to deliver to the market throughout the year.
“As a graduate, I am often ridiculed due to the nature of my business” Tate states. “My business has its challenges for instance unpredictable weather patterns that led to losses due to delayed market time”. Matt & Schaeffer, (2018) state that student entrepreneurs face the biggest challenge due to limited experience. However, resiliency in business ensures overall success.
THREE years later, Tate has fleet of pick-up trucks, reimbursed his uncle and he has repaid his student loan. He drives one truck and employed three other drivers to supply his groceries. Tate has expanded the geographical scope of grocery collection and penetrated to new farms far from his locality. Such success is only achieved through mitigating business risks and choosing the appropriate time to invest. As a student entrepreneur, profits are realized after fully repaying student loans (Hasan, Guampe & Maruf, 2019). Tate visualizes having more fleets of trucks to add to the pick-up collection to expand to new markets internationally in addition to becoming the main distributor to the local groceries.
Essentially, the distribution company, according to Tate, aims at transforming from small-scale to large-scale distribution. The large-scale distribution would entail the transport of commodities for corporate and government entities through the winning of tenders (Alves et al., 2019).
“I have signed partnerships and acquaintances with producers from the various economic sectors such as agriculture, construction, pipeline industry, motor vehicle, and the fishing industry to improve my business”. Tate reports.
All in all, the rapport with other successful organizations will help Tate grow to achieve more profits, business vehicles and lucrative supply tenders.
My interview with Tate Jordan proved to me that it can be challenging to begin a new business especially when faced with loans. However, success is possible through commitment, discipline and positivity.
