There are lots of businesses in the world, majority of which are failures. This article focuses on the failure of different businesses and it aims at reducing the number of failures in the business world by equipping her with this knowledge. Below are a number of reasons for business failure:
Poor Cashflow: Money is very important in every business, no matter how small it is. It is the lifeblood of the enterprise. Blatantly, no business can survive without a proper cash flow.
Lack Of Focus: When you try to be everything to every man, you will end up as nothing to any man. If your business has no specific niche, special market, specific target, it will definitely crash. Setting achievable goals in the area you are particularly good at will only grow your business, while trying to be big when you’re not there yet will crash the business.
Lack Of Planning: Having a good plan for your business is very important. Visualizing the business growth in matter of months and years should be included as well as expected goals and results per time. A perfect plan should have deadlines, a to-do list and dates in it.
Poor Leadership: Making the right decisions is a major lifeline that holds a business together. A leader that cannot make the right decision will definitely lead the business to its failure. Poor leadership will crumble both financial management and employee management. Learning from successful leaders and books will go a long way in fixing this problem.
Bad Customer Service: The saying goes that customers are always right. This is not because they are right; it is because you need to please them so they can patronize your business. Knowing what your customer is saying about your product and how you can satisfy them is the key to keeping them and making them market you to other potential customers. Poor customer service will ruin any business.
Using Business Funds For Personal Needs: Never mix business with pleasure. Your personal needs should not be attended to by business funds. It is business fund because it is meant to make more money. Personal use is no investment, only profit could be used to meet personal need, or else the business crumbles.
Overexpansion: The saying goes that you should ‘cut your coat according to your size’. Knowing your capacity and capability is of great importance in guiding your decision to expand your business. Expanding a business to a new market or larger market must be preceded by the maximizing of the previous or existing market.
Ignorance To Competition: You should know that you are not alone in this world and definitely not alone in the market. Knowing what your competitor are doing can do many things for you, such as; motivating you, updating you on information about you market and services and also to know how well you’re doing.