Top 10 Reasons Why Entrepreneurs Fail

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It is common knowledge that the majority of new business ventures fail within their first year of operation. There are literaly hundreds of reasons why these business ventures fail, and it is simple enough to search the Web for the most common reasons. Luckily I came about a great site that lists the top 10 reasons for the failure of businesses better than any other site that I researched. The site can be visited by clicking on this link: http://www.sparkplugging.com/freelance-parent/ten-reasons-businesses-fail/

1. Money: Whether you don’t have enough to adequetly fund a business, or you just do a poor job of managing it, money issues are one of the biggest downfalls of a small business.

2. Planning: Lack of planning is only second to proper money management with new businesses. Business owners need to plan for where, when, and how much to spend in order to ensure that the doors stay open.

3. Competion: Not only should you research your competition in the planning phase, but you also need to keep current once you’re up and running.

4. Pricing: One of the hardest parts of starting your own business is knowing how to set the best prices.

5. Marketing: Marketing is a complicated beast, and most of us are fumbling about in the dark when it comes to marketing our small businesses. If you aren’t able to hire a marketing professional, build some basic skills through your local library and online resources.

6. Inexperience: This is one problem that can bite the entrepreneur in so many ways. Perhaps you don’t have any experience in your chosen field. Obviously, this can hurt when you’re competing against businesses that have been around for years.

7. Sales: Many entrepreneurs are great with ideas but somewhat lacking in sales abilities. In your excitement, you may also have overestimated how much business you were really going to get in the early stages of operation.

8. Business Records: Not only do business records help you stay compliant with government regulations, but they can also help direct the future of your business by creating a clear picture of where you’ve been and where you are.

9. Dependence: Too often, a small business will become reliant on one or two customers. While having a steady customer is a great place to start your endeavor (it beats not having any customers, after all), it’s not enough to sustain you for long. It is vital that you continue reaching out to grow your customer base.

10. Burnout: Once you get to the point of engaging in your business, you may find yourself working ridiculously long hours in order to build momentum. In some cases, the burnout leads to “entrepreneur fatigue,” and you end up procrastinating or just not getting things done. Both mean the death of your small business.

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~ by maniebrahimi on June 1, 2009.

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