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There are a variety of reasons why most businesses fail. Following are the ten most common reasons in my opinion:
1. They don't have a business plan. They build a website without having any sort of business plan. That's like putting the cart before the horse. Develop a business plan first, then build a website. Why is having a business plan so important? Because if you a business plan, you'll have a much clearer vision of your goals, which will enable you to achieve them that much faster.
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 first, before starting a business. Don't get me wrong. No one is suggesting you have to know everything there is about running a business. I learn something new everyday. But at the very least, take a few business courses at your local community college so that you're not operating completely in the dark.
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. You have to effectively advertise in some way, shape or form.
7. They don't follow up. Studies show that a prospect must see your marketing message at least seven times before you can convert them into a customer. That's why it's important to have the ability to follow up. Collect your prospects name and e-mail address and follow up with an interesting, informative newsletter. Then after you convert your prospect to a customer, continue to follow up with your newsletter and by introducing new products into the equation.
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. Therefore, I give readers of my blog the ability to receive my updates via Twitter when they subscribe to my blog. That's taking advantage of a trend.
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