Why businesses may fail in rural areas!

[PICKFORD]

We all know what a rural area is. The area refers to those underdeveloped areas with no technology, poor network, low productivity, less or no infrastructure like health and education, high rate if poverty, less or no power supply, and yes or no employment or jobs. although there are a lot of entrepreneurs who take their businesses to rural areas to establish yet most of them fail and just few of them succeed, it is not guaranteed that your business might flourish or prosper in rural or underdeveloped areas due to some certain factors essential to boost business productivity and profit. Sometimes the choice of business you choose to establish in these areas could hinder productivity imagine opening a bottle water company in an underdeveloped or rural area such business is said to collapse anytime soon because as the name implies rural meaning illiteracy or poor standard of living so a lot of people might not be used to drinking treated bottle or sachet water but rather be used to drink water from streams, rivers, lakes etc after a series of water purification. Another reason why business might fail in rural areas is because of increase in crime rate, due to the high illiteracy rate in most rural areas a lot of people do not know how to fend for themselves or what to do to earn a living and most of able-bodied men over their grow up to the miscreant, thieves, drugs dealers, armed robbers, pick pockets, etc thereby disturbing the existence of businesses establishment.

 

[Deleted member 28127]

It is not usually true because there is some agriculture business that has no relation to technology or needs few instruments where you have a farm and production and sell animals or eggs or milk or something like this so it varies from one case to another.

 

[Jasz]

Nice post! Opening a business in a rural area can be extremely rewarding, but it also has its unique challenges. A successful business is predicated on many things, such as the need for up-to-date technology, and reliable transportation. If a business owner wants to set up shop outside of an urban center, determining if there is adequate advertising, providing services that customers need, and networking with other business owners can be essential strategies for survival. Successful businesses also must decide how to accept payment from customers as options in rural areas may be limited.






Businesses in rural areas have different challenges than businesses in more urban environments. These challenges may cause some to fail. There are a few factors that make a business more likely to fail in a rural area than an urban one. These include distance, time, and customers.



A variety of businesses may thrive in the rural areas, but becoming a business owner in a rural area is not easy. There are also other issues that may play an important role for the success or failure of a business in a rural area: 1. High population density ratio 2. Low consumer income ratio 3. Low labor force ratio

 

[Deleted member 13140]

Haha it sounds fo me that your definition of rural areas are cave men dominated areas.. to me I think a water bottle company will do pretty well in rural areas, because they know what good water is, I mean who doesn't, and for me rural areas could be a village deep within some country and yes they have an idea what clean water is but because they isn't any near them they result to the most reasonable thing, which is drinking water from the nearest clean stream, bring a water company near them, and provide them with water in exchange for food stocks they get from their farm and believe me it'll work all you then have to do is go to the open market and sell those food stocks for more than the price they expect.. simple.. a start up idea generated in minutes.

 

[eldavis]

Most rural areas are really backwards but not as primitive as you are making it sound, like I remember where I was posted to for my service year, it was actually a rural place, they had no tap water or even a well, they had to rely on streams. The power supply was also another issue, they have not seen light for years, but even with all these, they had access to generators and solar panels, they had access to phones so this is a sign that shows that modernization is coming in. I think for your business to succeed or not in a rural area, it depends on the kind of business you decide to start. You should make a research, there would definitely be things they lack get they make use of them, probably they have to travel to the nearest town or next community to get them, you can start such business there.

 

[Alexandoy]

I wonder why the title of this post is against the rural area when it comes to business. The rural folks also need goods and services although there are not many people there so the mall owners do not dare to build a mall due to the lack of customers. Do you really think that bottled water is not bought in the rural area? You have to see the rural folks in the Philippines. They are carrying bottled water when going to the farm. It is an old notion that rural folks drink water from the stream or spring but that is not so anymore. They have adjusted to the life in the city. Even the internet is also a necessity in the rural area especially that education is now done in the internet. Rural children are now using phones for their eduction which is unthinkable some years back.

 

[Jasmine]

Businesses in rural areas do not have to necessarily fail, but a lot of businesses fail because these businesses are started without research. Rural areas have thin population, therefore, you may not be able to generate a lot of sales. Furthermore, the priorities for rural population are different compared to the urban population. You will have to choose a niche that are accepted by the rural population. Rural areas are mainly depended in agriculture, therefore, you will have to sell agriculture related products such as farm equipment, seeds, fertilizer etc. to make your business successful in the rural areas. Convenience store can also become successful.

 

[Ridorz]

Well, I can say all what you said it's true and that is the reason businesses are failed in a rural area you have listed. But there are some business that can not failed in a rural area, such business is an agriculture business sector such as fish farming, poetry, a and plant farming etc. If you are a farmer I think a rural area is the best and good location that suitable for your business, so that you will able to be doing farming as well as you want. So, rural area has a business that can be running successfully in there.

 

[Chibson]

One of the major determinants whether a business will fail in a rural area or not is pegged on the type of product or the type of business you are doing there . There are some businesses that succeed in rural areas and some of this kind of businesses are agricultural products. It is quite very much important that when you do your agricultural product in rural areas, you sell them in urban areas. This kind of business is usually very lucrative and I have come across a lot of people making much money from it because people in urban areas many people usually do not involve themselves in agricultural businesses. Sometimes, there may be a lot of limitations in rural areas in terms of doing business because in some rural areas there may not be a good road network to transport agricultural products. Another is lack of electricity and other important amenities like pipe Borne water. But there are definitely some rural areas that have all these things and one of them is my own village. We have access to good roads and good water and there are many people in the village doing business and making a whole lot of money.

 

[Richee84]

Business can fail in anywhere and not just in rural area if the business feasibility study is not well carry out. It is very important to do the feasibility study first before embarking on such busines. There are business that can carry out in rural area and will be successful and there is also business that we can do in rural area that will fail. Any business that is not well researched in rural area before going there to establish such business will fail if it doesn't meet the demand and need of the people in that rural area.. Business should be set up to meet the need and demand of people and not just to generate sale, if a business is well researched to meet the need and demand of the people, such business will do very well in whatever environment it find it self be it rural area or urban area. Before establishing a business in a rural area the person must try to carry out feasibility study and know the needs of the people in that rural area then get the need for them and supply them. Once the business is able to meet the people's need then the people will be force to buy ur product.

 

[kayode10]

It can be very difficult to set up a lucrative business in the rural area. The reason is that there will be no parking is due to so many factors.

When the patronage is very low any business you found it difficult to make consistent sales.

In my comment I am going to highlight some of the Major face which makes it for business to succeed in the rural settings.

Dense population
There is going to be a market where there is a high population of people concentrated in a region. the case is quite different material settings as there are less population in most villages.

Low standard of living
Majority of the people in the rural settings have low standard of living. They leave basically for survivor. They only think of what they are going to eat and how to survive till next day.

Lack of commercial activities
It can be very hard to see a presence of commercial activities in a place where there is a low population. In some village settings they only go to the market once in a week.

Under development
Majority of the village settings are underdeveloped. the last some of the basic amenities like who killed and electricity which are very essential for setting up businesses.

It is only basic food business that can drive well in the village settings because no matter what happened people will definitely eat.

 

[Caramelle]

The success or failure of a business in rural areas will largely depend on the type of product or services your business is offering. Take note that businesses are regular fixtures in both urban and rural areas which means that there is a need for them in either place. If you can start a business that will supply the needs of rural residents, your business will likely succeed. As far as I know, crime rates are relatively low in rural areas as there are fewer people, and residents usually know their neighbors.

No matter how backward a place is, there is usually a small market where people can buy food and household items. Some mobile businesses usually set shop during weekends to sell food, household items, and other non-food products. While there are fewer consumers, there are also fewer competitors. In some rural areas, you can find one pharmacy, one bakery, one hardware, and so on. There may not be as much money going around, but most residents have their sources of income or funds that they can use to buy their daily essentials. For a business to prosper in rural areas, It's a matter of knowing who your customers are, identifying their needs, and selling them what they need.​