Why businesses don't succeed
According to statistics 9 out of 10 newly created business will end within 2 years of starting up, this will happen for a variety of reason as explained below;
Lack of focus - People who move from employment to start their own business sometimes lack the focus to build a good business. They are not use to having so many responsibilities and having to do so much by themselves. In employment they have a lot of built-in infrastructure that they have to create when they start their own business, there is no HR department, no admin, no database systems, no IT support. Importantly no one to overview the whole project to keep them on track.
The wrong product/service - You may think your product/service is the best in the world, your mum/dad/wife/sister/best mate/cat/dog may agree with you, but the rest of the world may not. Find out if your product/service is any good by asking someone independent, they may not spare your feelings but at least they will tell you the truth.
Lack of finance - Often people miscalculate the actual amount of money they will need to start the business and keep it running, especially in the days before the business starts to earn a good amount of money.
Overestimating sales - Research shows that people have a tenancy to overestimate good things and underestimate bad things. Businesses fail because the amount of revenue that was expected did not occur.
Underestimating costs - The sister of overestimating sales, people tend to underestimate the costs involved in running a business, and often believe they can cut corners and do things cheaper.
Lack of good staff - Having the right staff is crucial to the success of a business, hiring cheap labour that does not produce the high standard you expect, or simply believing you can do everything and not hiring staff is a key factor in why a lot of businesses do not succeed.
Competition - Big supermarket chains, overseas labour, the Internet, and technology are all big factors that can make the competition cheaper and better than you, resulting in you never getting a good start in the first place.
Bad location - A good business in the wrong place won’t succeed, you need to be where your customers are, and make sure your customers can afford you.
