SOME HARD TRUTHS
20 - 65%
START UP BUSINESS FAILS
30%
FLY BY THE SEAT OF THIER PANTS
25%
SUCCEED ALL THE WAY THROUGH!
While it's true that a significant percentage of new small business owners fail, it's important to note that statistics can vary depending on several factors...
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Data from the BLS shows that approximately 20% of new businesses fail during the first two years of being open, 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more.
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The 60% fails follows some critical issues:
1. Lack of planning: Many new business owners fail to create a comprehensive business plan, including financial projections, marketing strategies, and a clear roadmap. Proper planning is crucial to set achievable goals and stay on track.
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2. Insufficient market research: Understanding your target market is essential for success. Failing to identify your customers' needs, preferences, and competition can lead to poor product-market fit and lackluster sales.
3. Inadequate financial management: Poor financial planning, ineffective cash flow management, and underestimating expenses often contribute to a business's downfall. Thoroughly analyze and track your finances to ensure stability
4. Financial management and analysis: Consultants can help business owners develop financial models, forecasts, and budgets. They can analyze your financials and identify areas for improvement, such as cost reduction or revenue optimization. By closely monitoring the financial health of your business, consultants can guide you in making sound financial decisions and avoid potential cash flow issues.
5. Marketing and branding strategies: Consultants
can assist in creating effective marketing and branding strategies tailored to your business. They can conduct market analyses, develop a strong value proposition, and create a compelling brand identity. Consultants can also provide guidance on marketing channels, messaging, and customer acquisition strategies to ensure your business gets the visibility and traction it
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6. Insufficient customer experience: Neglecting to prioritize exceptional customer service and experience can lead to dissatisfied customers and negative reviews. Without loyal customers and positive word-of-mouth, sustaining a business becomes increasingly difficult.
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The 30% "fly by the seat of their pants" category is those entrepreneurs who find moderate success despite lacking formal planning and strategies. While some entrepreneurs have an instinct for business and adaptability, it's important to note that a more intentional and strategic approach generally increases the chances of long-term success.
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The 7% success rate pertains to businesses that achieve sustained success throughout their lifespan. These are the outliers who have carefully tackled the challenges of entrepreneurship, implemented effective strategies, and consistently delivered value to their customers.
"WE ARE EITHER EVOLVING
OR DISSOLVING, CHOOSE EVOLUTION OVER DISSOLUTION"
