from the desk of
Denis J. Burke, MBA
Senior Business Broker
The Top 6 Reasons WHY People Fail in Business
- People go in business without sufficient capital. Then they try to borrow operating capital from a bank, friends and family to stay in business. They max their credit cards. Debt is not one’s friend in starting or growing a small business. Many new small business owners overspend and mismanage the funds they have because they have never owned a business or have little or no business experience.
- People fail to research the market, the business or industry they chose. This is where a SWOT Analysis can be useful (An evaluation of market Strengths, Weaknesses, Opportunities and Threats).
- Many entrepreneurs neglect to create a Business- Marketing Plan, establish Sales Goals, project their Expenses, or develop any roadmap to guide them.
- People with terrific Corporate America backgrounds and experience believe their skills and know how will transfer to Small Business America. This is not necessarily true. The Entrepreneur mindset is different. Many corporate executives have been molded by the corporate way of life and are highly structured. Often, it does not work because the thinking, motivation and resilience required by an entrepreneur to succeed is extremely different from someone who has been accustomed to a guaranteed salary with benefits and pension plan while working for a large corporation.
- Hiring people in any business can be a real challenge. If you hire the wrong people and don’t stay on top of them, you can go out of business. Often you may have to hire and fire several people to get good help. Even then, employees become complacent. The tendency for employees and managers to steal always exists especially in retail, restaurants, bars and service related businesses. Protect yourself with proper hiring procedures and post an employee theft policy on premises.
- Individual entrepreneurs become a misfit in the wrong business. They bought into a business that they didn’t know anything about and just didn’t like it. Owning a Business is very demanding and a lot of work. Ultimately, they had the wrong expectations, had no idea how to run that business, and wouldn’t listen to good professional advice. They ended up losing money. So they had to close.
When you need Expert Business Advice email Denis@BusinessBrokerWorld.com