Owning and starting a business is a lot of work and it takes time, money, and patience. Unfortunately working in property management & leasing we’ve seen businesses fail due to a variety of reasons, but there are always a few similarities in every business we’ve seen. Here are the most common reasons why businesses fail and a few things to consider before staring one yourself!
WHY THEY FAILED:
1.)They didn’t have a clear blueprint.
If you don’t have a clear blueprint for your business you’re already starting off on the wrong foot. Starting a business is not the time to “wing it” or “see how it goes.” If your business isn’t making money in the first few months – then it’s losing money and this is very obviously not good.
It’s wise to have a clear written plan describing;
– How many employees you’ll need to run your store.
– What each employees job responsibility is.
– What is the main product your store will make income off of.
– How will you advertise your business.
– How much does it cost to keep your business open each day.
– How much in sales do you have to do to break even?
These are key factors in a successful business and planning makes all the difference. Have a clear outlined plan also makes you more desirable to a Landlord who is looking to let you lease their space.
2.) They didn’t know what they wanted from their business.
Although it can be stressful to look ahead in 10+ years time – it’s important to know why you want to start a business and what you’re expecting to come from it. Are you looking to start a business because you’re hoping to become a millionaire – maybe you’re looking to have a second location open by 5 years time. Define what you want for you business and where you see it going over the years. Having a clear “big picture” allows you to make logical decisions that support that plan – problems will come up in your business and you want to know how you’ll plan them.
TWO EXTRA POINTS TO CONSIDER
Have You Done A Strength, Weakness, Opportunity & Threat Analyse?
You might need outside assistance with this area of analysis – why – because you have to be brutally honest about what you’re looking to do. Before leasing your space & starting up your business it’s important to know where the strong and weak points of your business exist. Don’t start a smoothie business in a parking lot that already has a Jamba Juice – unless you KNOW for a fact you can offer clients something Jamba Juice can’t (even then this isn’t really a great idea ;). Another point to consider is sales; if you’re a clothing boutique that does 75% of your sales online then leasing out a HUGE, EXPENSIVE retail space isn’t the smartest choice; you’d be better off saving money on rent and instead investing it into more online advertising. Look at everything that will make your business fail and then figure out everything that will allow it to be successful – is it still a good business after you do this?
Have You Set Small Specific & Obtainable Goals
There are a few reasons why this is important;
One; it keeps you on track towards your set “big picture” and two; it keeps your employee’s motivated and allows for celebration and team building. Setting small and obtainable goals keeps your business moving forward; goals like “lets do ___ amount in sales today” or “lets get __ amount of positive YELP reviews” are real goals you can reach – and they keep you motivated! You want these goals to work towards your big picture because you can see visible and traceable success in your business and it helps keep your employees working hard towards real goals.
If this article was helpful to you we’d love if you’d share it! And if you’re looking for more business advice see here.