Every year, thousands of people across the country take a leap and start setting up their own business. Some would-be entrepreneurs start a business venture to have another go-to source of income along with their other finances while there are those who consider it as their major and lone financial support in life. Although there are entrepreneurs who acquired a successful business at start-up, there are also those who failed even after few tries. But why is it that so many entrepreneurs fail while only a few of them succeed? Why do entrepreneurs fail to succeed in starting their own business?
Even with the best business and economic background and having the right product in the right market, some entrepreneurs still fail to succeed in business. They fail not because they are doomed to fail but because of some overlooked factors behind it. Sometimes, the cause of failure lies neither with the product/service offered nor the current economic condition but in the entrepreneur itself. Starting a business is not something any entrepreneur can fake their way through; it’s either you’re doing it the right way or the other. To help you assess and re-evaluate if you are prepared enough to start your own business, below are the 6 indicators why most entrepreneurs fail which you can avoid.
1. Starting without an exact, well-defined plan
– Lack of well-defined, exact purpose is the major reason why most of the entrepreneurs fail. These entrepreneurs operate without any set of goals for their business and simply take whatever comes to them. Creating plans for your business helps you to develop ideas into the REAL business market and identify the specifics of your proposed business venture. Establishing a well-defined plan allows you to gather more business concepts for a successful business venture – how the product will be sold, who will buy it, how it is differentiated from similar products/services, and etc. Without this, any would-be entrepreneur cannot evaluate his/her business effectively for potential challenges and pitfalls that may result to major business fall down.
2. Inadequate knowledge and the unwillingness to adapt
– No entrepreneur gets ahead in life without building and feeding themselves with new knowledge. Many entrepreneurs do not invest in themselves. They tend to forget that a successful business also requires a certain level of competencies, skills, and knowledge in order to remain functional. They want to have a successful business but they do not do further research nor attend training that can help them increase their knowledge base. They remain to operate under the same level of perception of setting small, insignificant goals for their business and never go beyond their comfort zone, thus, leaving their business in the same, old state as before. They continue to focus on old, little things that don’t even matter and failed to focus on the things that lead to better results.
3. Setting wrong expectations
– This is another reason why most entrepreneurs fail. They want instant results; they want to get the money back as quickly as possible. However, they failed to recognize that it takes ample amount of time to build a successful business. Some entrepreneurs think that once they get into the business, the money starts rolling in without doing anything. You must give your business the time to develop, grow and yield profits. Remember that building a successful business is not created overnight.
4. Accepting failure as permanent
– Some entrepreneurs allow their fear of failure to stop them from doing certain things that can help them move forward and achieve their business goals. They forget that making mistakes are essential to success. They are too afraid to undertake little changes because they’re afraid of committing mistakes. They have the mindset that all error is harmful and wrong when most of it is necessary and helpful to achieve a successful business. There’s nothing permanent about failure unless you stop moving and pushing forward. To experience failure is not to fail, but to take one more step on the final path to success. Push away your fear and dare to take action.
5. Poor money management
– Cash flow is the heart of business. Most entrepreneurs lack control over their personal cash flow and continue to spend their money irrationally. In fact, lack of cash is the major reason why entrepreneurs fail. Inadequate cash can seriously ruin a business. If you aim to succeed in business, make sure to plan out your spending to allow your business to grow. Make it a priority to redeploy all excesses from the business to the business.
6. Quitting too soon
– This is one of the common reasons why many entrepreneurs fail. You should always remember that business half-done is never a success. You must strive against all odds to make your business stand and work. Some entrepreneurs start their business in a very good state with high expectations but if one of these expectations are not met, they get weary and easily discouraged, and just when they are about to experience a great breakthrough, they quit. They quit when just a little more persistence should have made the big difference between successful business and a failure.