According to the Small Business Association (SBA), 30% of new businesses fail within the first two years of operation, 50% fail in the first 5 years, and 60% fail within the first 10 years. Only 25% businesses continue running for 15 years or longer. With the right planning, more businesses can be successful. Here are the major reasons why most businesses fail.
Problem in planning
You need a solid business plan to be successful. The business plan should contain an outline of your goals and how you expect to meet them. You have to conduct research and surveys to find out what your business needs. You need to calculate the costs and form strategies and timelines to implement your plan.
Not enough financing
If you have little capital, there is high chance that your business will fail. You should be realistic before you start a business. You should decide how you are going finance your business once it’s up and running. If you make a sketch about your financial planning at the beginning, then your business will never go down.
Inappropriate location and internet presence
If the location of your business is not right, then your business will fail. You should set up your business where you will find customers. The online presence of your business is equally important. You should have a smart digital marketing strategy to increase your online customers.
Reluctant to change
Business trends are frequently changing. You need to adapt your business to the latest trend to compete and move forward. You should adopt new technologies and make your business more efficient.
Thinking of expanding fast
The expansion should be treated like you are starting a new business again. You should carefully plan and develop strategies for it. You need to do a thorough research on the market before deciding to expand.
It takes a lot of effort and time to start a new business. You should take careful preparation before you hit the road. When a business fails, it is very demotivating for the person, and it creates a barrier to moving forward. So, research and plan well before starting a new business.