Some of the main reasons that businesses fail, are caused by things that could have been avoided.
- Lack of Research – Not understanding your market, current and future trends, your customers, your competitors, your target audience, and how to reach them effectively can all contribute to things crashing down, down the road.
2. Not Having A Business Plan – Business plans create clarity, direction, and begin to wire into your mind a deeper understanding of the inner workings of your future business. This is an essential step.
3. Not Having The Proper Funding – No business runs without money. Understanding your fixed (consistent) expenses and variable (inconsistent) expenses, is key, while also understanding how much money you will need beyond that in terms of cash available. All of this in relation to your suppliers, and the timeframe for customers to pay for your goods and services.
Keeping all of this in good financial condition, is something you want to understand well in advance.
4. Financial Mismanagement – Staying on top of your cash flow is super important. Making sure you have a cash reserve on hand at all times, invoicing on time, and on point book keeping will all keep you financially sound.
5. Lack of Proper Marketing – ‘Build It & They Will Come’ is a myth. You must market. Depending on your target audience and the best way to reach them you might choose between:
- Direct Mail
- Business to Business
- Social Media
- Posters & Flyers
- Digital Marketing
Or some combination of all of the above. In the beginning you may try them all, and then over time, will likely narrow down to what creates the most results. Cost efficiency.
6. Lack of Customer Base – Enrolling, selling, and tending to your customers needs and priorities is what will build a loyal customer base. Asking their needs, listening to their feedback, and implementing what they need will give you an edge above your competitors.
7. Lack of Adaptation – Being able to adapt to changing conditions is key. Whether that be in the market, the community, disasters like COVID, or even a mis-hire within your business is what will keep things in order as things invariably evolve across time in your business. Stay woke.
8. Growing Too Quickly – Sometimes success can strike too. Not being prepared in terms of supply chains, cash flow, technology, and staffing, can ride us later. Be prepared.
9. Not Hiring The Right Team/Or Talent – From Good To Great by Jim Collins – Getting the right people on the bus, so essential. The right mindset, culture, and heart set of a team, can take a business from Good, to Great.
10. Not Asking For Support – Making sure you have a network of support is essential and critical for your businesses ultimate success. From multiple sources of funding (banks, government funding, financiers, etc.) can all help keep you in the green. To community members, support groups, friends and family, to see you through the inevitable challenges that starting a business will do.
Having a plan doubles the chance of success of any new venture.
Bottom line, it pays big time, to prepare.
And I can help.