If you’ve never seen the statistic mentioned in the title before, it’s probably come as a bit of a surprise. Unfortunately, the harsh reality is that only one in 10 new businesses is destined to make it beyond the five-year mark. On a brighter note, many of those failed ventures bring it on themselves. Therefore, avoiding the common mishaps can go a long way to helping you achieve your goals.
Let’s take a look at some of the key issues you must look out for.
A Lack Of Support
When starting a new business, it can be tempted to go it alone. It’s cheaper and bypasses many of the fears related to taking on employees. Unfortunately, you can only achieve so much with one pair of hands. Falling into the trap of thinking it’s you versus the world could cause major stumbling blocks.
A positive recruitment drive can provide the engine for future success. Find people that can bring ideas to the table, and those innovations could prove to be pivotal. This can include outsourcing too. As they say, two heads are always better than one.
Establishing a bond with the audience is one of the hardest challenges facing any new business. As such, many companies try to reach as many people as physically possible. In reality, this could be the worst decision you’ll ever make. Finding your niche will influence everything from product design to marketing methods. It could be the key to increased efficiency.
The sheer size of modern customer bases means that you can afford to be more selective. Moreover, succeeding with a small demographic is infinitely failing with a large one. So, the sooner you discover your place in the market, the better.
No Safety Net
Entrepreneurs are constantly tasked with solving problems. Prevention is always the best form of protection, which is why you should always look to handle things in the right manner. Nonetheless, you cannot stop all issues from arising. The next best thing you can do is ensure that those problems won’t cause lasting damage.
Building a financial reserve to get you through tough times can be very useful, even if it means using a line of credit. Meanwhile, being prepared for potential lawsuits is equally vital. Liability insurance provides the emotional reassurances that you deserve. Many of the companies that do not protect themselves in this manner succumb to the first legal battle they encounter.
Communication sits at the heart of all business endeavors. Many failures can be attributed to deficiencies in this aspect. Whether it relates to team unity, marketing, or customer care doesn’t matter. Problems in any of those fields will come back to haunt the venture and could prove to be the downfall.
As the business owner, it’s vital that you set a positive tone. Don’t be afraid to invest in your development with courses related to communication. Pass this knowledge onto the team, and it will be better news for everyone, including the clients. If this doesn’t increase your hopes of success, what will?
Sometimes, though, business do fail despite seemingly doing everything right. Outside factors relating to the economy, technology, and social changes can make all the difference. As such, it never hurts to keep your fingers crossed for a little good fortune.