A lot of people want to explode their personal finances by starting their own business. What many people don’t realize is that over 35% of small businesses fail within their first 2 years, and 50% within 5 years. This infographic shows 10 dangers you must avoid when starting a business to avoid an epic fail.
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- You Start Your Business for the Wrong Reasons
You cannot build a successful business just on the desire to make money. A small business is an all-encompassing proposition and you must absolutely devote 100% to it, or it’s unlikely to succeed.
- Poor Management
Many owners have the inability to delegate or are unable to create systems for employees to follow. This puts more stress on the business owner as they are having to make all of the day-to-day decisions, and they aren’t left with time to spend planning the growth of the business.
- Lack of Capital
If you spend any time doing research on why businesses fail, virtually every expert agrees that the number one reason for new business failure is the lack of capital. Most people underestimate the costs to start a business and how quickly the business will begin to generate income.
When it comes to small business success, all experts agree that a big part of it comes down to location.
- Lack of Planning and Market Research
Most people who start a small business do so based on a hunch or perceived need in the marketplace rather than conducting the appropriate market research.
- Growing Too Quickly
When a business just starts they often enjoy a surge of business. This can give the business owner a false sense that they need to immediately grow the business.
- Poor Website or Social Media Presence
93% of people looking for a product or service use the internet for research. 50% use a smart phone or other mobile device, and 34% use a home computer for the same purpose.
- Owner Burnout
Most people don’t realize how much time is required to run a small business. It’s essential to hire and train the best possible employees, have good systems in place and a designated manager.
- Not Adapting to Changing Market
Small business owners need to constantly get feedback from their customers on how they’re doing so they can adjust their business practices accordingly. Owners can’t simply guess at this.
- Too Much Competition
Whatever product or service you provide, there’s a finite market. If too many other people are providing a similar product or service you’ll be at risk.