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The First Reason Why Small Businesses Fail

The First Reason Why Small Businesses Fail

The data on the survival rate of businesses showed that 22% of small businesses fail within the first year, 32% for the first two years, and 40% for the first three years of business.

But why?

The lack of funding or capital is usually the main reason why small businesses fail because the operating expenses are costly from payroll to supplies to rent and more.

Moreover, many don't understand how to price products to create profit, and more often than not is that they don't pay attention to their cash flows.

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MORE IDEAS FROM THE SAME ARTICLE

  1. Develop a growth mindset
  2. Set doable goals
  3. Learn why customers are leaving your business and establish a feedback system
  4. Identify your target audience
  5. Perform a SWOT analysis to get bac...

Another mistake that many entrepreneurs make is that they don't have good business plans. A business plan must include the following: business summary, competitor and market analysis, business model and operations plan, marketing and financial plan, and product and service offeri...

Weak management.

Many enter into the business world because they're passionate about something but rarely do they get into business with a passion for human resource management and operations.

A survey showed that 52% of small businesses have labor quality problems...

Small businesses lack the ability to understand their customers because they are often not prepared to meet the marketing demands of their company.

Poor marketing can result in difficulty in determining costs and the inability to reach a target audience and conversion goals...

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