Five Reasons Businesses Fail
Five Reasons Businesses Fail
There are exceptional rewards to having your own business. You build self-reliance, confidence and can enjoy independence. But make no mistake, there are pitfalls. Long hours, a sense of loneliness and irregular paychecks can be just a few. Starting and maintaining a business can be challenging at the least. That’s why you should know these five reasons businesses fail.
Lack of a Viable Business Plan
A well-conceived business plan can serve as your map for success. It can also serve to set goals and monitor your progress. Find mentors and those who have experienced business success to provide input for your business plan and refer to it often.
Lack of Financing and Financial Resources
There is no doubt you will build sweat equity in your business, but effort alone is not enough. You need financial resources for equipment, inventory, marketing, payroll, taxes, insurance and other day-to-day operational expenses. Lack of financial resources leaves no room for mistakes and can lead to decisions that are contrary to your business plan.
Poor Inventory Control and Management
Having too much inventory on hand can be as much of a problem as having too little. Inventory absorbs cash in most cases, cash that could be used elsewhere. Poor inventory control can also lead to theft, including employee theft, which is one of the main reasons businesses file bankruptcy. Monitor inventory and financial resources carefully.
Disorganized or Inexperienced Marketing
This is a wide-ranging area that encompasses lack of knowledge about your target market, digital and traditional media, content marketing, branding, advertising and sales. You should not just know the various ways to reach your target market but the best, most efficient ways to reach them.
Failure to Clearly Listen to Customers
Your customers will likely tell you what they want, when they want it and how much they are willing to pay, if you listen close enough. If certain products or services aren’t selling to your expectations, your customers either don’t know about them, have no interest in them or find them too expensive. Listen to them.
Businesses can also fail due to circumstances seemingly outside of their control, like natural disasters, accident injury claims, theft or vandalism. All of these, however, can be covered by a business insurance program. Contact one of our independent business insurance associates to see how affordable a basic business plan can be for your organization.
Do you have questions about your insurance? Find an insurance agent near you with our Agent Finder
Search All Blogs
Search All Blogs
Read More Blogs
Garage Sale Bingo
Items You Can Expect to Find When Heading Out to Yard and Garage Sales
Give It Away
Does “Giving It Away” Make Sense for Your Business?
Life’s Challenges and Rewards
The Hills and Valleys Are Just a Part of It
Frequent After-Market Add-ons for Cars and Trucks
We not only love our vehicles, but we love making them our own. Is your car or truck properly insured for these add-ons?
Getting Serious About Energy Savings
Are You Ready for the Next Step in Going Green?
Getting Your Mind Out Of the Gutter: Fun Bowling Facts
Staying in Your Lane Used to Mean Something Different
What Are the 7 Habits of Highly Effective People?
Do You Practice These Habits?
How Many People…
Odd and Interesting Facts About All of Us
Distinctive Automobile Headlights of the Past
Headlights Do More Than Just Help Us See at Night
Why You May Need Renters Insurance
Don’t Be a Renters’ Insurance Denier. Here’s Why You May Need Its Protection.