3 Reasons Your Startup Can Fail
Starting a business is risky—any startup entrepreneur will tell you that. But there are things any entrepreneur can do to mitigate that risk and position your business for success.
If any of the below factors sound familiar to you, you might need to reassess your dedication to your small business—or take the necessary steps to bring that business back on track.
1. Lack of Direction
If investors are a part of your startup strategy, then you’ve most likely already created your business plan. But whether you’re looking for investors or not, a business plan isn’t just a one-time document used to appease your directors.
Your business plan shouldn’t be static—it should grow and change along with your business—but it should serve to provide direction for your business. It’s a way to hold your progress up against what you believed that progress would be by now. But if you don’t have a business plan (or if yours is severely outdated), consider this: if you don’t know where you’re going, how will you know when you get there?
2. Dysfunctional Team
You can have the highest quality, the most competitive prices, and the greatest website in the world—but if your employees can’t work together, you’re going to find it very, very difficult to take your business to the next level.
Sometimes there’s a disconnect between management and employees—management doesn’t always have a solid understanding of how things are really going on the front lines. Are your salespeople bickering with each other in front of clients? Do your customer service team members have the tools and training they need to present the face of your business you want them to present? Are customer issues being lost in the day-to-day shuffle?
You might want to think about how the other players on your small business team are affecting your business. It’s extremely difficult for small businesses to compete with their big-box competitors on price: make sure you’re able to compete in other areas, especially the ones that can really make you stand out in the eyes of your customers.
3. Lack of Big-Picture Thinking
There are so many tools the modern entrepreneur has at his or her disposal that sometimes it’s easy to get lost in the details—but it’s important that you keep your business moving without getting stuck in relatively unimportant time traps.
For example, consider the small business owner who sets up a Twitter account for the business. If the business owner isn’t familiar with using Twitter for personal use, it might be a very steep learning curve. Our entrepreneur could spend two hours of choosing a handle, creating the perfect bio, finding people to follow, tracking down re-tweets, reading articles, and all of the countless other small tasks involved in being an active Twitter user.
Or, in that same amount of time, our entrepreneur could have followed up on leads, engaged in product development, emailed prospective vendors, and any number of tasks that would more directly affect the bottom line.
To avoid losing the forest for the trees entirely, consider hiring a part-time employee—or even an independent contractor—for tasks that might not be worth as much of your time (remember, you’re the owner of the business) as others might be.
[Thinking about hiring someone to help you, but not sure where to start? Check out our archived post on finding and recruiting great employees!]