Home
>
Small Business
>
How to Avoid the Most Common Reasons for Small Business Failure

How to Avoid the Most Common Reasons for Small Business Failure

The life cycle of the typical small business is short and painful. It starts out with a dream and ends with a whimper. And in between, a struggle of Herculean proportions is played out as the owner tries to figure out why the business isn't succeeding.

Depending on which survey you read, up to 80% of small businesses fail. Most fail within the first five years and those who survive the first five are often losing money. Pursuing a career in small business ownership seems like a fool's footpath straight to failure and poverty.

So, what is the difference between the 80% that fail and the 20% that succeed? When you examine the reasons that cause business failures, you begin to understand that most business failures are preventable. The major missing ingredient is knowledge. Business owners who get expert help before they open a business have a much greater chance of succeeding. Business owners who get expert help as their businesses grow and change succeed more quickly with fewer speed bumps along the way.

Why do businesses fail? A study published by Jessie Hagen of U.S. Bank gives the details of the top reasons for failure:

General Business Factors

? 78% - Lack of a well-developed business plan, including insufficient research on the business before starting it.

? 73% Being overly optimistic about achievable sales, money required and about what needs to be done to be successful.

? 70% Not recognizing, or ignoring, what they don't do well and not seeking help from those who do.

? 63% Insufficient relevant and applicable business experience.

Financial Factors

? 82% Poor cash flow management skills/poor understanding of cash flow

? 79% Starting out with too little money.

? 77% Not pricing properly - failure to include all necessary items when setting prices

Marketing Factors

? 64% Minimizing the importance of promoting the business properly.

? 55% Not understanding who your competition is or ignoring competition.

? 47% Too much focus and reliance on one customer/client.

Human Resource Factors

? 58% Inability to delegate properly - micro-managing work given to others or over delegating and abdicating important management responsibilities.

? 56% Hiring the wrong people - clones of themselves and not people with complimentary skills, or hiring friends and relatives.

To get your own business on the right side of the 80/20 split, assess your business to see if any of these Failure Flags exist. Then, systematically eliminate them. And if you don't have all the skills you need, hire an expert to help you. The cost of having a professional on your team is far less than watching your business join the 80% club.

Caroline Jordan is a small business coach and mentor working with small business owners to conquer the skill gaps that prevent success. For a free special report called Seven Secrets for Small Business Success visit http://www.thejordanresult.com. Get Knowledge. Get Focus. Get Results.

no-contract cleaning service Mundelein ..

In The News:

Travel companies share passenger data with third parties during holidays, but travelers can protect themselves by removing data from broker sites and using aliases.

Xpeng's humanoid robot moves so realistically that crowds believed it was fake, marking a major advancement in robotics technology ahead of 2026 commercial launch.

Researchers discover phishing scam using invisible characters to evade email security, with protection tips including password managers and two-factor authentication.

iPhone and Android users can reduce battery drain and data usage by restricting Background App Refresh to Wi-Fi connections instead of mobile networks.

Scammers nearly stole an Apple account by exploiting the support system with authentic-looking tickets and phone calls, users can protect themselves with safety steps.

FoloToy restored sales of its AI teddy bear Kumma after a weeklong suspension following safety group findings of risky and inappropriate responses to children.

Threat intelligence firm Synthient uncovers one of the largest password exposures ever, prompting immediate security recommendations.

Viral video shared by Elon Musk shows Tesla's Optimus humanoid robots performing tasks from cooking to construction, garnering over 58.5 million views on social media.

Chinese hackers used Anthropic's Claude AI to launch autonomous cyberattacks on 30 organizations worldwide, marking a major shift in cybersecurity threats.

Apple's new Sleep Score feature gives you a rating for your nightly rest quality. Learn how to set it up on your Apple Watch and iPhone today.

Essential phone settings to enable before losing your device, including Find My network, location services and security features for iPhone and Android.

The Fox News AI Newsletter gives readers the latest AI technology advancements, covering the challenges and opportunities AI presents.

Cybersecurity research shows weak passwords remain a major threat, with simple patterns and number sequences putting millions of accounts at risk.

New Android malware BankBot YNRK silences phones, steals banking data and drains crypto wallets automatically. Learn how this advanced threat works.

FDA approves first human trial for Paradromics' brain-computer interface that could restore speech for paralyzed patients through neural technology.

New phishing platform QRR targets Microsoft 365 users across 1,000 domains in 90 countries. Learn how to spot fake login pages and protect your accounts.

OpenTable now uses AI to track your dining habits and share insights with restaurants. Learn what data they collect and how to protect your privacy.

Google's discontinued Nest thermostats still secretly upload home data to company servers despite losing smart features, raising serious privacy concerns.

New Android malware NGate steals NFC payment codes in real-time, allowing criminals to withdraw cash from ATMs without your card. Learn protection tips.

DoorDash confirms data breach exposing customer names, emails, addresses after social engineering attack. Learn how to protect yourself from scams.

Concerned about Google's AI scanning your Gmail? Learn how to disable Gemini features that access your emails, Drive files and Chat messages for privacy.

Google warns Android users about dangerous fake VPN apps hiding malware that steals passwords, banking details and personal data from phones and tablets.

Apple's digital passport feature lets iPhone users breeze through TSA checkpoints this holiday season using Digital ID technology at 250+ airports.

A new phishing scam targets family photos with fake "Cloud Storage Full" alerts. Criminals steal credit card information through fake sites. Learn protection tips.

South Korean scientists create ultra-thin fabric muscles that turn clothes into robotic assistants, lifting 33 pounds while weighing under half an ounce.