10 reasons why your business could fail!

To many of us, seeing a business come crumbling down isn’t something new. Some of us have even had to go through the heartbreaking tragedy of having to shut our business doors because things have failed! Surprisingly, many folks out there can’t actually explain exactly what caused their businesses to collapse. Here are ten reasons why your business could fail.

Poor management. Poor management is on of the core reasons as to why so many businesses have come crumbling down. As the name suggests, poor management involves leaders having poor communication skills, poor conflict resolution, poor attitude towards work, poor adaptability to changes, excessive oversight among others. Whenever you see such traits among your employees, failure is knocking at your door!

Lack of information. Meanwhile many young people are interested in starting businesses today, they aren’t as much interested in equipping themselves with information relevant to their line of business. This is dangerous in that lack of information in business is akin to blindness. All business decisions must be taken basing on facts, otherwise, wrong decisions are bound to be made. Always take care to purposely look out for more information about your business.

Rigidity. I personally have seen many small and large businesses alike crumbling down because of one simple fact, being so rigid! Refusal to embrace new ways of doing business because one is so attached to to the old ways of doing things is one huge mistake many business leaders in Africa often make! The world is moving on fast and innovators aren’t sleeping. Soon, the things we see as top notch will become obsolete. Flexibility and innovation is the only way to stay afloat. Otherwise, sinking is inevitable.

Mismanagement of inventory. Back in the day, my parents owned a grocery store in the neighborhood. Things seemed to be moving on well at the beginning untill they started grossly mismanaging whatever inventory was there in the business. A year later, the grocery store was no more!

Lack of sales. The sole purpose of starting a business is to make sales so that a profit can be made at the end of the day. So a business that fails to make sales is destined for collapse! Sales is the heartbeat of any business there is. There’s no way business expenses can be met if the business doesn’t make sales.

Failure to understand customers. As a businessman, it is important to understand the need your customers want fulfilled and how exactly they want it. That’s how business works. When you begin to see things this way, then you’ll keep your customers and even attract new ones. Failure to understand this simple trick will eventually rid you of your customers. We already know what happens to businesses that lack customers.

Unsustainable growth. While some people think growth is a good thing, business growth has to be sustainable in every aspect. Uncontrolled expansion had led to the collapse of several businesses simply because expansions come with costs among others. When operating costs exceed the business revenue, failure is up next!

Poor planning. The truth is many businesses today operate without a business plan. Proprietors or business leaders do not know exactly what they want to achieve and have misguided priorities. This is not healthy for business. Every business must have a workable business plan which must guide all business activities.

Complacency Most times when our businesses are doing well, we tend to feel overly satisfied with our achievements that we do not take care to examine potential dangers that await us. So when the danger actually surfaces, it’s a surprise that we are not ready to deal with. Usually very fatal.

Lack of focus. I know of a man who likes calling himself the Jack of all trades. He’s quite a good Businessman but he’s always confused! Simply because he feels he can do everything, he never really gets to accomplish anything. Focus on one thing and do it really well, others can come in to diversify later.

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