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12 reasons why new business fails

  • 12 reasons why a business fails!

    By Bishop Wayne Malcolm

     

     

    1. The E-Myth - entrepreneurial mythology is the basis for many business startups. The most common is that technical skill is a good reason to go into business. This idea is a myth. The skills needed to fix cars are entirely different from the ones needed to run a profitable car repair company. The mechanic who opens a shop with no business skills has been deceived by the most common entrepreneurial myth!

     

    2. The wrong objective – are you building a job or a business? The objective in business is to create a system that works for you, without you! Ultimately it is residual and passive income. Otherwise all you have created is another job.

     

    3. The failure to realize what business you are really in – The real business is marketing the business. You are not in the restaurant business; you are in the business of marketing food-based experiences. Marketing is your approach to getting and keeping customers!

     

    4. The failure to play to your strengths – The SWOT analysis will reveal strengths and weakness. Instead of working on your weaknesses, you should go to work on your strengths so that you become outstanding where you were already good. You should outsource your weaknesses.

     

    5. The failure to innovate – improve: product/promise/process – Everything is in a constant state of change. You must make incremental improvements to the product, the promise or the process in order to maintain an advantage.

     

    6. The failure to establish customer rapport – rapport can be understood as two people dancing together - to the same tune. It is mutual understanding and trust. Customer rapport comes by seeing everything from the customer’s point of view. It means critiquing and conducting the business with the customer in mind.

     

    7. The failure to cultivate non-transactional relationships – We have entered the age of trust in which people will only do business with people they know. We must go beyond networking to relationology. These people will refer you, consult you and become indirect brand ambassadors for you.

     

    8. The failure to understand the new consumer - The new consumer doesn’t believe what you say about yourself, they only believe what others say about you. Social media, endorsements, testimonials and social consensus are the new due diligence. The new consumer doesn’t want to be satisfied; they want to be amazed! The new consumer has unprecedented choice, which is why you must advertise your advantage. The new consumer is intelligent and has access to information. The new consumer. The new consumer doesn’t by products or services; they buy results and outcomes.

     

    9. The failure to convert customers into clients. Repeat business is big business. You have to keep them coming back. The task is converting customers into clients and clients into ambassadors.

     

    10. The failure to inspect – People don’t do what you expect, they do what you inspect. Information management systems are a critical success factor for business today. Ready and real time information will enable a quick decision. Quick decisions are needed.

     

    11. The failure to hire slow and fire fast – businesses fail when a CEO doesn’t have the courage to let go of staff that are sabotaging the business. Or the nepotism and personal allegiances make it impossible to fire someone without uprooting the company. These businesses hire fast and fire slow.

     

    12. The failure to anticipate and manage change – Everything is changing thanks to technology and globalization. You must become a student of trends and of your highest competitors in order to stay ahead. However, change must be managed so that it produces the result you envisaged.