Mistakes are an inevitable part of our lives, especially in business. Mistakes, if handled prudently, can be powerful learning curves. That is not to say that we should live carelessly simply because mistakes are inevitable, no. Efforts should always be directed toward doing things right. You can learn from personal mistakes or those made by others. I urge you to draw lessons from the mistakes of others so that you avoid the same mistakes. In this article, I thought to share an account of a personal business mistake I made in 2021. I believe real-life accounts carry more weight than just theoretical scenarios.
How It All Began
Last year there was a time I was exploring ways to quickly raise a certain amount of money for some family project. I considered several possible avenues but was initially failing to settle for one. Then in going about my errands some time someone mentioned the prospects of chrome mining. The little I gathered initially was that you could put together some money, and buy chrome from individuals. You would do this in pursuit of filling say, a 30-tonne truck. Once done you would go with or send the truck somewhere the chrome would be bought by other players. Their high returns given the huge gap between the money you paid for the chrome initially and the money paid for it when you resell it. That was the catch and it sounded so alluring.
Who To Approach?
The next step involved looking for someone reputable to kick start the venture. I had heard that it is best to find someone who owns a chrome claim. Then the chrome I needed I would get it from that claim. So I asked around and I heard there was someone I knew who owned a chrome claim. This is someone I knew remotely and from years back – they would not even remember me. They stay in my neighbourhood. We had once travelled together from Beitbridge some time back. I figured that would be the best person to approach given our brief shared history. I then asked around for their contact because I had lost it. When I got it I made a call and they indicated they were not around but would return the following day.
The following day I made the call to find out if they were back. Unfortunately, they were not yet back and they insisted we just talk over the phone. I was heavily opposed to this because I wanted a one on one meeting. They insisted on the call and I told him why I wanted to talk to him. He then explained what I needed to do and how much was needed. As would turn out later, discussing over the phone like this was the birth of my biggest business mistake in 2021.
I Was New To The Chrome Business
What he told me to do was to put together US$600. He said that would be enough for 2 truckloads of 30 tonnes each i.e. the truckloads I would resell. The prospects were promising and I even knew some people whose fortunes had changed all thanks to this very venture. Sadly, what emerged later is that he did not give me adequate information. He did not do so for nefarious reasons but he wrongly assumed I knew about the business. Thus he only told me what I would be told if I knew about the business model already. My being new also meant I did not know the right questions to ask to establish all that I needed to know. Thus there was a massive communication breakdown.
It turns out one of his sons was the one managing the claim. So he gave me the son’s contact and I proceeded to give him the US$600. He also must have assumed I and the dad were on the same page. It was only later that it started becoming clear that I had rushed into this without enough information. As it became apparent later, the US$600 was only for access to the claim to get the two loads. Getting the chrome mined, who would mine it, paying them, and its transportation was all supposed to be my financial responsibility. This meant that US$600 fell short of the actual amount needed; of which I had exhausted my savings at the time already.
My assumption going in had been that after paying US$600, the claim owner would facilitate the mining of the chrome and its subsequent transportation for reselling. Then afterwards he would recoup his cut and costs and give me my cut. Turned out that was not the case. Later we had to map out a way forward to see how best to salvage the situation. This was in November 2021 and was supposed to start seeing returns in December 2021. We are now in the second quarter of 2022 and I am yet to realize any returns.
I should have insisted on the one on one meeting just as I wanted from the onset. That way we would have discussed at length rather than discussing business on the phone. As much as possible discuss business via one on one meetings. Especially when discussing intricate details. I should have taken more time to research and do due diligence before releasing the money. I rushed things and I dropped the ball because of that. My psychology was compromised because of the prospects. I was so blinded by the prospects that I ignored the importance of doing enough homework first. These are lessons you should never forget when you get into business ventures.
That was my biggest business mistake in 2021. It goes to show that at times we can let our guard down even when we know what must be done. Mistakes are a learning curve and this is a mistake I will never repeat in my life. My wish is that you never get to make the same mistake.