REASONS WHY BUSINESS FAIL

Thousands and thousands of new businesses start up
every year, and many of them do not even make it
through their first year. There are many reasons that
businesses fail all of the time, and they can range from
bad products to bad management. Some people that
have been successful in business do not always
become successful on their first try, sometimes you
have to live and learn and a failed business venture
will help you learn what not to do if you plan on
starting another business. If it is your first time
business venture then you should take a good look at
failed and successful business models, this will help
you understand some of the things that work and other
things that do not work.

Lack of Experience
Lack of experience at running a business is one of the
big reasons many new start-ups fail within the first
year or two. Just because you do not have a lot of
experience does not automatically mean that your
business will be a failure, but knowing this is a big
reason for business failure should motivate you to
learn the ins and outs before jumping in head first.
There are plenty of places you can learn what needs to
be done, you can research online and find advice and
stories that will help you gain some insight into
running a business. Another thing you can do is ask
someone you may know that runs their own business,
pick their brains for a while and allow them to be a
mentor to you. This will increase your chances of
making your business a success after the first year and
for many years into the future. Knowledge is key, so
learn everything you can before making the jump, and
don’t let lack of experience keep you down!

Bad Management
Bad management is another of the main reasons that
many new businesses fail, some can say this is due to
lack of experience and that could be true in many
cases, but not all of them. There have been many
people that have started new businesses that had
plenty of experience but because of bad management
choices the business fell flat on their faces. Bad
management can take many forms; one of these could
be bad management of finances which can cause a
business to go downhill really fast. This is one of the
reasons it is a good idea to hire an accountant to help
manage the financial part of any business, someone
that knows what they are doing can help eliminate the
business failing because of bad money management.
Another example of bad management is hiring people
to run the business for you and not paying attention at
all to what is going on. Some people think they can
just start a business and hire people to let them run it
right from the get go, but In most cases this is just
setting yourself up for failure. If you do hire people to
manage and help run the business you should still
always know what is going on, plus you need to trust
the people you have running your business. Monitoring
every aspect of your business will ensure that things go
well and it is the only way to do it as a startup.

Lack of Planning
Sometimes people have all of the right intentions when
starting a business, but many times people get anxious
and excited and start the business right up with little
or no planning. Having a business plan laid out before
you launch is key, and this is extremely important if
you are looking to get some help funding the business
at the start up. When you are trying to get a loan to
launch your company almost all banks want to see
your business plan, so this is the first thing anyone
should do when starting a new business endeavor.
Lack of planning can hurt in many other ways as well,
another example is not having enough products to meet
the possible demand you may encounter. Thinking
everything through beforehand is a must, as well as
knowing what you need to start off successfully. There
are many organizations that can assist you in starting
a business for the first time, and seeking out one of
these types of organizations to help you get going can
be a big help and will definitely make sure you have
planned everything out so your business has a great
chance of being a success.

Location
Location can be extremely important when you are
starting a new business, you could have an amazing
business idea and a great building but if your location
is somewhere that people will not find it easily it could
turn out bad for you. It is good to find a place where
many people will see your place of business so you will
get walk ins and people coming by to check out what
you have to offer. Sometimes even a struggling
business can pull it together and survive if they have
the right location, and on the other hand, you could
have a great store or other type of business that is
amazing but if it is not in a good location the business
will most likely fail no matter how good it is. When
starting your business try to find a location where there
is potential for a lot of people to see it, this will help
more than you can imagine and will be the key to your
success.

Starting a Business for the Wrong Reasons
There are many people that start their businesses
because what they offer is something they are very
passionate about, and then there are also many people
that will start up any business that they think can
make them a lot of money. If you plan on starting a
business make sure you are starting something that
you have a strong interest in, because if you are not
going into something you love your chances for
success are very low. If you are not passionate about
what you do other people will see that and in many
cases customers will find another company that does
the same thing but is run by someone who really cares
and knows all about their products and services.
People that only want to make money with a business
tend to only bother learning a little about what they are
selling, but in order to be successful you need to know
EVERYTHING about what you are doing, and there will
be many questions from potential customers that you
need to be able to answer. If you cant answer the
questions or do not have the experience people will just
go somewhere else. So if you are starting a new
company make sure you love what you will be doing,
otherwise you will most likely fail in under a year.

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