"80% of businesses fail in the second year and 80% were experiencing a failure in the fifth year"
(Michael E. Gerber)
Very surprising results of a survey conducted by Michael E. Gerbertentang new businesses that have failed in his second year as much as 80%. Whether your business is 20% of it? Surely you are at the level of success. As a business owner, you must know what the cause of failure in business, so we must anticipate and make your business become more successful and more successful. The main reason for business failure 7 are as follows:
1. Ambiguity run business
The business owner has not decided on the values, vision, mission and business objectives and business plan, so it is not the focus of what the business is run. Since there is no clarity run business lead business owners do not clear the purpose and not make a written business plan to guide them in areas of the business, financial areas, family areas and health areas. Without written goals and plans, you like people who travel to foreign lands without alloy or a map.
2. The low mental: impatient, greedy and indecisive
Business owners are not realistic about how long to achieve business results, no patient in taking the results, in doing minimal expenses and the absence of a specific job or focus on running the business at first. Business owners think that they can produce many benefits regularly and easily. Many businesses fail because business owners looking for ways to make huge profits quickly and become an instant millionaire. In running a business takes a process.
Business owners often do not experience time and money unwisely, without consideration of consequences, actions that can not wait, without taking the time to acquire data and memikirnya, no matter how far the business has been run in an inappropriate direction of its business objectives.
Kareta fear of failure, many business owners avoid dealing with the challenges or obstacles and is often destroyed because they keep low-performing in the business.
3. The low sales, service and poor relationships
Lack of enthusiasm in the sales department is the main factor reandahnya sales which is one of the main reasons for failure in business. Decline in sales to reduce cash flow and can cause failure in business. Business owners need to prepare the team to think and focus on sales and subscriber at any time. Make sales as the main priority of the sales team and other teams. Anticipating the trend of market failures, products and services. Look forward, one, two, or three years. Where marketing will run? What market trends? What products are offered now? Is appropriate to market demands? What changes need to anticipate the wants, needs and preferences of customers. Bad relationship with the business environment and corporate team will lead your business can not survive long with others. Either within or outside your business, it will lead to failure for your business. Hostile and negative thoughts cause business owners quick-tempered, often criticized, protested against the staff is not good, suppliers and even customers.
4. The low financial knowledge
Lack of ability or low knowledge of Financial Statements, business owners do not know how to set it or too busy. The business owner must know exactly how much money he had, how much debt, how much is owed to him, and the target to receive or pay in total. Decide on a complete accounting system so you always know where the money is used.
5. Lack of control and discipline in the system
Weak control systems in each line of the company, such as sales, inventory, accounts receivable, operating expenses, especially in the areas of sales companies; system sales, how to achieve the target, how to get customers in a cost efficient, way to sell it, means of delivery, method of sale, the selling price , way of monitoring. Whether everything has been done konsiten and continuously? Lack of control and discipline in the system that causes a failure in business.
6. Shortage of working capital
Working capital is not quite often faced by business owners. The business owner was too optimistic and impatient. Business owners know that to start to raise finance from the sale of time-consuming and in general you need six months to provide cash before starting your business.
7. Lack of planning
Because planning is weak, the lack of a written business plan, both in the short and long term. Business owners react continuously, even become overwhelmed with work to be done. Business owner and his team must be clear in terms of priorities in each area of work and kept asking what the most important strategies in this present time. And what can I and only I do, if I do well, will make a real difference.
After learning the seven main reasons of business failure, then you as a business owner or executive can do anticipate, especially in the areas of your weaknesses and still continue to improve your area of excellence. Excellent Regards, Your Way to the Ultimate Success.
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