Why Small Business Fails

By:Drew Stevens | August 14, 2017

According to the U.S. Small Business Administration, there were 28.2 million small businesses in 2011, and they made up all but 0.3 percent of U.S. employer firms. (Forbes 2017) And, many of these firms are some of the most innovative and successful in the United States. Where many Fortune 500 firms struggle with shareholder returns, innovation, hiring, economics and a myriad of other issues – small business is doing great!

However, with the pleasure of operating a business comes some pain. What follows are some issues seen by the average small business and some methods to help cure them.

Issue Cause Solution
Not enough business Lack of Marketing

Lack of Sales

Business will always suffer when it forgets to produce a consistent and relentless process for bring customers in the door. The product will never sell itself. It is imperative to produce outbound efforts that grab consumers’ attention.
Working Too Hard Poor time management

Not reviewing expenses

Not focusing on things

that produce revenue

Organizational skills

The business requires systems. There has to be a system for sales, a system for marketing, a system for billing. Most important you need to have resources that make life easier. When possible outsource. You do not have to waste your time attempting to print business cards when a regional or online store can do this for you. Think of your hourly salary and what this can go towards to produce business rather than waste your time.
Lack of Organization Poor Time Management

Procrastination

Lack of Prioritization

Poor Delegation Skills

 

 The successful professional is well organized. The more organized the easier the day. The best and most successful understand how to move around the hurdles in a structured manner so that they accomplish more- with less. Procrastination kills success because it provides obstacles that inhibit progress. Begin each day with three of the most important things that must get done that day. Once you do you feel more accomplished.

 

Feeling Lost No business systems

No written business plan

or model

No organizational goals

such as 3 and 5 year

plans

No Sales Forecast

One of the most used and often abused terms in corporate and financial lexicon is the word ‘strategy. Many organizations believe they are strategic and operating at maximum efficiency. The issue with these firms is that they act tactically. There is much ado about nothing. Operating a business without a strategy is analogous to traveling to a new destination without a map or global positioning system (GPS). Strategy becomes the overarching force that maintains focus of the business. Strategy creates focus for two organizational virtues: 1) client acquisition, and 2) client retention.
No Help From Staff Lack of Team and Money

Lack of capacity

People make a large difference with offloading items and moving the business forward. However, it does require that you hire correctly. Hire for innate talent and not personality. People need to be able to conduct the job if their life depended on it. And, you need to delegate. Delegation is nothing more than entrusting someone to do the work you cannot get to.
Loss of Passion Lack of direction

Inappropriate exertion of

energy

Lack of business advisory

 When there is a lack of direction there is frustration and stress causing a lack of passion. You have to get your passion back by realizing what avocation created your occupation. Go back to basics and review the talents and gifts that brought this business forward. God gave you skills – use them!

 

Customers Uninterested Lack of Value Too many businesses create products and then continually talk about facts, facts, facts. Customers do not buy facts – the invest in benefits. And, logic does not allow people to create action – emotion does. Look at what you are saying. Talk in terms of benefits and value. Use adjectives that create emotion and energy in your sales pitch.
Lack of Traffic Lack of Marketing Marketing is similar to being at a rock concert it’s not about screaming louder it’s about being different so that the singer or star recognizes you. Too many businesses sound just like their competitor. They create sentences that develop stereotype. There is no distinction from the competitor. Unless you’re sounding differently or doing something differently no one will notice. You need to be Like Elton John or Lady Gaga noticeable. You also need to create a community that surrounds your product. Community happens when you create enough noise for potential clients to hear about you. This requires a complete, thorough, consistent and relentless marketing approach in digital and traditional formats.  You you are loud and illustrate value – people will come!

 

Competitive Pressures No target market

Concentration on the

wrong things

Lack of a proper value

message

 

A wise coach once told me to be aware of competitors but do not concentrate too hard on them as it stops you from growing. Competition is good if you know your differentiation, can articulate your value and continually market. The more relationships you have the easier it becomes to not only be competitive but also outstrip the competition.

©2017. Drew Stevens, all rights reserved.

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