Small Business Information Center. Com

Small Business: No need for Failure

Reasons for small business failure:

Numerous studies have found that most small businesses fail within the first three years of their operation.  These same studies have found numerous reasons for small business failure, even when the owners are well motivated, work long hours and have set specific goals to be achieved.  The basic reasons that have been identified in these studies include inadequate knowledge, planning, and money.  It's obvious that being motivated, working hard and setting goals are never enough to ensure small business success.  In fact, working hard may not always even be a necessity in some businesses.  The following are important things that small businesses should do to improve their chances for success: 

• You need understand how much knowledge of the product and technical aspects of the business will be required of the small business you are entering.
• You need to understand how much you will need to know about the business side, including accounting and recordkeeping.  This may vary according to the type of business.  Some businesses require a lot and others require very little.
• Make sure you understand exactly who your typical customers are.
• Take steps to ensure potential customers will know about your small business and can easily reach it.  This frequently involves two factors: promoting your business and your business location.

Promoting your small business: The promotional aspect will tell people about your small business and what you offer of benefit to them. It frequently includes various forms of marketing and advertising.

Location: The value of location varies significantly according to the type of small business.  It can be an important way for people to become aware of your small business. A good location may also make it easy for customers to find your place of business.  It may be a significant factor for some businesses and have very little importance for others.

• Plan ahead. A good business plan is absolutely essential. Try to spend time anticipating things that may happen to your small business and how you would cope with them.  Anticipate problems and plan ahead.

It's always important understand that you do not have to be an expert in all aspects of a business… you may just have to be reasonably knowledgeable.  However a serious deficiency in your knowledge can spell disaster in any small business.

Information provided by Will Davis’s Start Your Own Business for $1000  

By Paul Susic MA Licensed Psychologist Ph.D. Candidate President/CEO Susic Psychological Consulting P.C.