Why do businesses fail…?

3.    Our survey asked entrepreneurs in free format, the main reasons for failure……

Recent UK reports show that at least 500,000 people start a business each year and of those over 50% fail.

The reasons cited for starting a business are the desire to be your own boss, freedom and work life balance and overall, to be in control.

We have discussed the need for the entrepreneur to be the workaholic, but when asked why there are failures, they cited the following;

In order;

A.     Insufficient capital and finance

B.     Recession and outside forces

C.     Lack of strategic direction

D.    Owners excessive drawings

E.     Insufficient accurate financial information

F.     Failure to pay government taxes

Bill Gates said; ‘success is a lousy teacher. it seduces you into thinking you cannot lose’

One cannot underestimate family pressures while discussing the start up process for the entrepreneur as more often than not the business starts from a round of funding from friends and family. Daddy’s money is relatively easy to lose. The ego sets in and poor decisions can be made. Equally, pressure on time and money can divert the entrepreneur’s focus.

In summary, you can read from these last 3 insights that warning bells are there – throughout.

It’s not easy.