It’s not uncommon for a small business to fail. In fact, it has been shown that only two-thirds of new small businesses make it for two years. At the end of five years, there is only a 50 percent survival rate. One out of three small businesses will still be operating after 10 years. But why?
There are three main culprits of small business failure: a lack of capital, a lack of planning and a management structure that leaves something to be desired. Any one of these three things an wreak havoc upon a small business, and a combination of the three is almost certain to amount to failure.
Lack of Capital
Too many entrepreneurs start their business before they are financially ready to do so. Small business owners tend to focus on the start-up costs and don’t take into account that they may not immediately begin bringing in revenue. Without capital, a business is not only difficult to run, but may be left vulnerable to lawsuits and more.
Lack of Planning
In some cases, entrepreneurs cast too wide a net. They don’t pinpoint a way that they can be unique. They target the same audience, sell the same goods or offer the same services as their competition. Without something valuable or new to offer, these small businesses rarely get off the ground.
When entrepreneurs start out, they need a management structure. If a small business owner doesn’t know how to keep accurate records or stay organized, they often muddle along the best they can and neglect to spend the money on a professional who can offer assistance.
As business owners ourselves, we know that having someone handle the details can make all the difference in an entrepreneur’s success. Reach out to us today and discover what we can do for you and your small business. We want you to be one of the businesses that is still in operation in 10 years.