Why business fails?
Do you love to taste the new product of the market? Do you love your old brand? Whenever I go to buy any electronic product firstly, I search for my habitual brand. If I don’t get my favourite logo, then look for other brands. And I think every customer do the same as I do.
They don’t want to buy a new product or brand easily. Why does a new business product fail in the market? Why they become the last choice of the customer?
Much new business born and die in the market every day. The market place has become a gaming field. Only the player wins who know the rules of the game. Have you heard someone saying “my business fails because of my bad luck?” However, there is no direct relation between luck and business.
The business success doesn’t depend upon fate, but on the deeds. Surprisingly, 98 out of 100 venture fails in the market, because of different reasons. Nowadays, the market has become highly competitive. Therefore the new business fails simply in the market.
So, what are the reason for the new business fail? Whey they hardly a success.
Why business fails?
No effective planning.
Because of the lack of proper planning, the new business fails. So, every business requires long term and short plan to get success. Most of the venture fails because of the lack of answer to these questions:
How will I do the daily activity?
Who are my customers?
Where will sale my product?
How will I survive in the crisis?
From where I will raise the working capital?
SO, you can’t run the business until your business plan doesn’t have the answer to those question.
If you are not a good swimmer, then don’t jump in the deep river without safety measure. And, an enterprise plan is like a safety measure, and the market is a deep river. Therefore try to understand why you want to do the business and make the plan according to your business goal.
Does your business have a lot of liabilities?
How much dividend do you pay to your shareholders?
How much money do you spend on paying interest?
Most of the business fails because of unwanted liability. So, the more liability means your business has more expenditure. It means that you have to distribute your profit on the interest and dividend.
Thus, If you want to add fixed assets to your business with a net worth of 10000 dollars, then, don’t take the liability more than that value.
Unlimited liability is Ok for the big venture. However, unwanted liability is not Ok because it can dissolve your business. Use your capital if it is a sole proprietorship. Only take a loan or issue share, if it is necessary or, you want to expand your business. Therefore, due to unwanted liability business fails.
Lack of skills
Why does your business fail?
How business fails if you don’t have skills?
DO you have good communication skill? Do you have good management skill?
Are you a good manager? Can you make people do what you want?
Do you have the talent to make a quick decision in a time of emergency?
Similarly, money management skill is equally needed to run the business smoothly. You need to utilize your business fund in profitable areas.
Most of the business fails due to lack of management and interpersonal skills. The success of your business depends on the customer. And It is hard to earn customer than earning money. Therefore, success depends on how we handle customer and fund.
Your business will fail if you don’t have business experiences.
I am the university topper, and I have an MBA degree so, I want to start my own business. Do you also think so?
Do you have any business experience? Have you ever worked for any business organization? How much you know about marketing? Or, you are relying on your MBA degree?
If you are thinking about starting your own venture depending on your university score than it is not going to work. Because to run business experience and skill are required, not a degree. There is no connection between your marks and business.
Most of the business fails because of a lack of experience and knowledge. If anyone starts a business without knowledge, then they will fail much time.
So, don’t waste your life whole life by making mistakes and getting lost. First, learn then earn.
Do you want to sell ice cream in the winter? Yes, selling ice cream is a good idea. However, the timing is wrong. Who will taste cold in the cold?
You have enough capital, so you want to open a hotel in the ruler area. Yes, your concept is good to open a hotel, but your place is wrong.
Why does the business fail?
The business fails, because of using a good idea and at the wrong time and place.
Most of the business fails because of a wrong business friend.
Are you running a partnership firm?
Do your partner is supportive?
Does your partner say ‘let’s work together’, ‘let’s share equally’, let’s grow together’?
If your business partner is evil-minded, then your business fails.
How business fails due to the wrong friend?
Because your partner leaks your plans for some self-benefit.
Evil partner is like cancer, they can destroy you and your business silently.
So, choose the partner wisely who have business experience and learn from him.
The business fails due to lack of patience.
There is a saying never give up. However, few of us use this theory in our life.
What do you think your every endeavour will vomit gold immediately?
It takes time for a good result. How much can you wait for something?
So, if you want growth, you have to wait. The most business person fails because they give up in their first failure. However, failure is the fix, if you try something new in your life. You can’t always expect a win-win situation. For instance, we don’t know when the business will take a turning point. Therefore, don’t lose hope if you fail.
Instead, learn more and try to innovate your idea and actions.
No interest and passion
Why do you want to do business? Because your neighbour or friend is earning a lot from it? If you do business for this reason, then you are showing a red shirt to the bull. Unless you don’t have passion and excitement, don’t think about business. A most business fails because the person copies other’s profession.
Business is not a money tree that grows in the land of the dreamer. It is a money tree that grows in the field of the person who wants it and works for it.
Lack of fund
Business is all about the game of money and behaviour. Therefore, a venture without sufficient capital is like a handicapped. Because of the lack of fund, the business fails in the time of crisis and depression. Do you have enough fund to invest in sudden opportunities?
To survive during worse time do you have reserve capital? Do you have funded for all the expenses, salary and wage otherwise, your employee will not support you.
Suppose new technology arrives in the market now can you buy it before your competitor do?
I don’t have sufficient capital to expand my business. This kind of tone does not suit in the business world.
Business fails during Pandemic?
Do you want to drive your car at night without a headlight? Due to the lockdown, you all are sitting jobless at home. Therefore, different kind of thought would come in your mind.
So, you may be thinking to establish a new venture during the lockdown.
Have you thought about why you are not getting a job? Because you have no talent?
You are absolutely talented. However, the companies and business organization don’t want to pay your salary, because there are not earning anything.
Companies and business organization are the sources of job. However, they are not doing well due to COVID19.
If they are the player of the market, but also facing loss, then who you are to think about starting a new business during this economic crisis.
Until the pandemic, the different concept of marketing will go flop. So there is no guarantee of business success during the COVID19, but doubtlessly the business fails.
You are already depressed due to COVID19 then why to welcome more stress?
Yes, but if you have good knowledge about the online business, then you can do a lot during this lockdown. However, if you don’t know about digital marketing, then give your time to learn during the lockdown. Because after the pandemic, the business will depend on online.
IN contrast, currently, there is no suitable environment to establish a business. Therefore, if you don’t want to add more stress and worry in your depressed life, then wait for the pandemic end. Until pandemic develops new skills and prepares your strength and talent.