REASONS SMALL BUSINESSES FAIL.

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1.. LACK OF DEMAND
This usually affects passion based businesses where someone starts a business around something they love only to realize the market is not interested.

POOR PLANNING.
Although a business plan does not guarantee success, having one ensures you think through the necessary details in advance.
POOR LEADERSHIP
The ability to get things done, manage, direct and inspire others to follow your vision is crucial for success. Lack of it can kill a business.
COMPETITION
If you are in a lucrative market, you will have competitors, both new and old. Failure to differentiate well can lead you to want to compete on price which can make your operations unsustainable.
CASHFLOW PROBLEMS
No mater how profitable you are, you still need cash, its the lifeblood of business. Without it, everything can come to a halt.
WRONG PARTNER
Partnership in business is like marriage. The righ one can make your work and life easier and more progressive. The wrong one can turn it into a living hell. Same with business. The wrong partner can hurt your business, embezzle funds, etc.
IGNORING CUSTOMER NEEDS
Saying we value our customer is one thing, acting that way is another. Many small businesses loose customers due to poor customer service.
LACK OF SYSTEMS
Lack of systems means everything depends on the owner or a few key employees. If those employees leave or the business owner gets sick, it can mean instant death for the business.
THE WHITE LEOPARD CUSTOMER.
Do you have one huge customer your business depends on? Its risky because if you loose them, the business could collapse. Diversify now.
POOR LOCATION
If your business depends on walk in traffic, you have to be careful in selecting where to do business from.
PERSONAL USE OF BUSINESS FUNDS.
Are you on a salary or other structured compensation from your business? If not, there is a high risk of using business funds for personal expenses. Sometimes its lack of discipline.
POOR FINANCIAL MANAGEMENT & PLANNING
This can mean failure to keep records or even failure to make decisions based on the financial data. It can also include lack of profit planning. If all the sales are going towards operation expenses, the business will struggle. Healthy profits are necessary.
NOT LEARNING FROM FAILURES
Failure is part of business. What matters is to understand what caused it and ensure it doesn’t happen again.
INSUFFICIENT WORKING CAPITAL
A business needs enough money to produce what it sells, pay bills , pay employees and have enough left over for investment.
PREMATURE GROWTH
Growth is good. Done too fast, it can kill a business. Growth often entails hiring more people, opening new locations etc. Without adequate preparation, this can be the beginning of the end.
LACK OF FOCUS
Jumping from one idea to the next without giving each enough room or attention to grow.
MACROECONOMIC FACTORS
These are factors a business cannot control. They include but are not limited to recessions, natural disasters, civil unrest, pandemic e.g COVID-19 etc..