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10 Reasons Why Most Businesses Fail

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10 Reasons Why Most Businesses Fail

Postby David Jackson » Tue Feb 10, 2009 2:32 pm

There are a variety of reasons why most businesses fail. Following are the ten most common reasons:

1. They don't have a business plan. They build a website without having any sort of business plan. That's putting the cart before the horse. Develop a business plan first, then build a website.

2. They're incompetent. You'd be surprised at how many businesses there are out there being run by principals who don't have a clue about running a business. Don't embarrass yourself. Educate yourself, before starting a business.

3. They're undercapitalized. Unless you're an experienced sales and marketing person with the ability to improvise and create, it's very difficult to start a business without any money. Granted, with the advent of the Internet you don't need as much money to get started as you once did. But you still need money.

4. Poor website design. First impressions are everything, and the first impression that is presented by many businesses is a poorly designed website. Internet browsers are an impatient lot. Instead of hanging around trying to figure things out, they simply click-away and move on to the next site.

5. Poor presentation of product or service. You've probably heard the saying, "Presentation is everything." Truer words have never been spoken. How well you present your product or service will ultimately determine its success or failure.

6. They don't advertise. You can have the greatest product in the world, but if no one knows about it, you won't make any sales.

7. They don't ask for the order. As unbelievable as it may sound. I've actually read ads where the company presented its case for buying their product, and never once asked for the sale.

8. They're in it strictly for the money. Businesses that exist to serve their customers approach business entirely different than businesses that exist to serve themselves. Don't kid yourself. Customers can sense the difference, and if you're the latter, customers will avoid your business like the plague.

9. They don't learn from their mistakes. Some businesses continue to make the same mistakes over and over again. Albert Einstein once said, "The definition of insanity is doing the same things over and over again and expecting different results."

10. They don't take advantage of trends. Things change rapidly on the Internet. However, many businesses don't recognize and take advantage of that change. For example, Twitter is red hot right now, and while I personally choose not to Twitter, I recognize the fact that some of my readers do. Therefore, I give them the ability to receive their updates via Twitter when they subscribe to receive my blog updates. That's taking advantage of a trend.

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Postby Juliawilliams » Wed Feb 11, 2009 12:54 am

Thanks David for such an informative article but what to do when a business person is suffering from financial crisis, wish to adopt every way but don't have so much sources, how one can raise capital from market and can achieve success in his/her own business
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Postby lisamariemary » Thu Mar 12, 2009 5:25 pm

I'm not sure what David would say, but, my advice would be to start working on some affiliate marketing to build up some income coming in that you can then pour back into your main business. (if you have a main income, of course)
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Postby David Jackson » Thu Mar 12, 2009 6:00 pm

Juliawilliams wrote:Thanks David for such an informative article but what to do when a business person is suffering from financial crisis, wish to adopt every way but don't have so much sources, how one can raise capital from market and can achieve success in his/her own business


First of all, you're quite welcome, Julia. Now to answer your question...I don't mean to sound facetious, but when you're in dire financial straits, you have to find a way to make things happen in your favor.

Let me tell you a true story. About twenty years ago, just before I started my first business, I was working at a dead-end job that I hated, living pay-check to paycheck. I felt trapped. I couldn't afford to quit, but I had a burning desire to start my own business.

I didn't have the money to start my own business - nor any way to borrow it. So, I continued working at that dead-end job, plus got a second job. I saved my salary from the second job to eventually launch my first business.

The point is, I did what was necessary to get out of my situation. You have to do the same thing. You have to find a way to get out of your situation.

Maybe that means getting involved with an affiliate program, as Lisa Marie Mary suggested. Maybe it means borrowing the money. Or maybe it means getting a second job like I did.

I don't know what else to tell you. I guess you'll have to figure this one out on your own. Best of luck to you! :)

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Postby tknoppe » Thu Mar 12, 2009 6:05 pm

A very inspiring story David. Boils down to: "If there's a will there's a way." Persevere.
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Postby David Jackson » Thu Mar 12, 2009 7:11 pm

tknoppe wrote:Boils down to: "If there's a will there's a way." Persevere.


Exactly right. Thanks, Traci.

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Postby lisamariemary » Thu Mar 12, 2009 7:41 pm

tknoppe wrote:A very inspiring story David.


Agreed! Thanks for sharing it with us David - we all need all the inspiration we can get! :D
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Postby David Jackson » Thu Mar 12, 2009 7:53 pm

lisamariemary wrote:
tknoppe wrote:A very inspiring story David.


Agreed! Thanks for sharing it with us David - we all need all the inspiration we can get! :D


My pleasure. Thanks, Lisa Marie Mary! :)

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Postby angienewton » Thu Mar 12, 2009 9:04 pm

Great article and such an inspiring story too. I agree with everything you suggested. Great tips to help Julia, thanks.
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Postby David Jackson » Thu Mar 12, 2009 9:14 pm

angienewton wrote:Great article and such an inspiring story too. I agree with everything you suggested. Great tips to help Julia, thanks.


Thanks, Angie! I appreciate that. :)

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Postby terrapin719 » Fri Mar 13, 2009 2:47 pm

I admit I giggled a little at #2 ... LOL :lol:

I don't think I'd say that anyone was incompetent! Other than that you've put together a very informative list here.
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