9 reasons why small businesses fail

Failed small business statistics are very scary for startups and entrepreneurs looking to start their own business. Although the number of commercial births outnumbered commercial deaths by 105,000 in 2014, the number of small business closures was still shocking at 246,000. If you're a startup and don't want to see your business as one of 246,000 companies, it's wise to take some tips on how to keep your business going. Here are 13 of the top reasons small businesses fail – If you're doing one of these (or more!) it might be time to seriously reconsider how you run your business.

1. Starting a business for the wrong reasons

Nothing is as troublesome as someone starts a business because they want money, fame, and connections. For any company to have any chance of success, its founders must be loyal to the cause, by producing a service or product they believe in. Hopefully, if you have the right reasons to start with it, everything else will come naturally. Unfortunately, this doesn't happen in reverse, so don't expect money to flow when your heart isn't in it!

2. Mismanagement

You may be committed to the cause and want to communicate your product to people, but saying and doing it are two completely different things. Being able to execute plans and effectively guide employees to get results can be difficult if you don't have managerial experience or if you're not comfortable in a leadership role. Consider how comfortable you are with the project and your role before moving forward and moving forward. It's always important to take risks, but make sure they're the right risks!

3. Location

With the advent of the Internet comes a decrease in the need for physical outlets and stores. Many companies do well by only working on social media platforms with online marketing just to showcase and sell their products. However, this does not mean that the site is completely irrelevant. Location may not be as important as it once was, but it's vital for small businesses. The ideal location for more rural areas is the local community center, where local support is readily available and custom is more tolerable. Other things to consider are rental prices, staff accessibility and property quality.

4. Ineffective marketing

Your company can make the best product on the market, with high demand. But if you don't market properly, no one will know about you, so no one will buy your product! Ineffective marketing is one of the easiest problems facing small businesses, as it can be solved simply and with little money. Just buying a few business cards and creating a website and social media account will give you a chance to be exposed. Updating and reviewing them regularly is essential for company maintenance, but they remain a low-maintenance part of running a small business.

5. Excessive expansion

Contrary to these scenarios, your business may have got off to a great start and even growing. But there is another dilemma. A growing company smells of success, but knowing how to grow in the best way for your business is key. Growth requires returning a certain amount of money to the business so that it can have more resources and continue with sustainable quality work. You'll need to invest in new employees as your business grows, and failure to do so is what prevents growing companies from breaking into the mainstream market.

6. Failure to outsource

Failing to delegate tasks to others and even looking outside your employees in search of inspiration and action (hiring a freelancer, for example) will simply lead to job failure. It can be difficult for business owners to accept that they cannot take full responsibility for the company they founded, but realizing this sooner rather than later will have positive results.

7. Lack of planning

Thinking ahead is one way businesses maintain customer expectations. It is important to stay ahead of the game and anticipate market trends in order to work smoothly and minimize unexpected changes in the market. Failure to plan and take measures for such events can lead to the collapse of the company in crisis. Keep pursuing your workload and predict (and plan) the worst in order to continue to make a profit.

8. Insufficient action plan

A business plan is an essential part of the company information that must be provided during company incorporation. A good business plan will cover a range of topics from your company's mission statement to the timeline for incorporation and distribution. The goal of this document is to be able to detect loopholes or problems that may manifest themselves in the future, and eventually lead to business failures. Without an extensive business plan covering your marketing strategy, you're unlikely to see any problems coming, and it also indicates that you're not skilled in business.

9. Lack of online presence

We've briefly mentioned online marketing and how simple steps can improve your overall marketing strategy at little or no cost. We felt it was an important issue in the demise of small businesses, and it had to be replicated. Without a professional online presence, people won't know where to look for you. Connecting with companies is one of the main ways customers decide if they want to buy a product, so spend some time learning about your social accounts and how to use them, before considering them a platform for young people only!