Why do businesses fail?

[TylerBakerllc]

Too little start up funding, improper market assessments, etc.

It's several factors obviously.

[Sundreez]

I am interested in this thread because I just started a new business. Everything mentioned are good reasons ventures succeed or fail, but there is something no one has mentioned. There seems to be a tendency to engage in price wars, good for the consumer at first, but bad for business. Forcing business to lower prices until there is negligible profit. At some point the business will no longer be profitable. It is impossible to choose between raising prices and losing customers to your competitor and lowering prices and selling at a loss. Once a store goes out of business, the survivors that forced them to go out of business thru their price competition will feel free to raise prices. Price wars is the reasons so many stores closed in 2008, most recently is Circuit City. It is also the reason so many production jobs are exported to markets with cheaper labor pools and why we see so many "made in China", "Made in Viet-Nam", ect. labels on the products we buy.

[outsourcery]

Mental fortitude..
I think a lot of [people get far too excited with the idea of success, and then 6-12months of long days and not a lot of thanks starts to crush you. If things aren't going to plan, doubts start to creep in. Unless you are very disciplined and have effective coping mechanisms, this errodes your decision making and exaggerates your problems. Well that was my last failure anyway

The other issue is undercapitalisation, this really means you have to swing for a home run on the first ptich or you're out. The more $$$ you have, the more you can afford to swing and miss...

[davidqi]

communication is important, clear everything what we talked, confirm everything before you run, check the details carefully, pay according to the deal you signed, give your partner as more confidence as possible

[Jenie0109]

lack of dedication...

[Rich & Sunny]

(95%) New Businesses Fail within their first year because of many factors. But what it comes down to is the Secret that the other 5% know and apply that makes the difference between individuals who is extremely successful compared to those who struggle in their business, wether it be online or offline.

So what is the "Secret" right?

It's not surprising at all,
one must surround and associate
themselves with those who are already
successful in that field.

The bigger your circle of influence, the wealthier (knowledge)
you'll be in that particular field PERIOD!
This is why the 5% category succeed
and never have to worry about money again.

A fact: 90% of all lottery winners go right back
to where they where 3-5 years later after winning big.

The Problem is: MENTALITY and Discipline!

[Plimus]

Usually lack of demand for the products offered is the main reason why businesses fail. Also lack of sufficient promotion might be another reason why businesses tend to not succeed.

[Tyrone]

Simply because they don't read a lot! They taught they can help their selves that easy. I know how business can stand firm for long!

[BrianGX]

I like the last post

[itzpaul]

I think it has to do with many reasons. A successful company is a balance of everything.

No Passion, Bad Company/Business Management, Over Spending, Not Marketing Enough, Not selling Enough, Bad Customer Service will ruin a company.

[armenh]

Businesses fail because they lack in persistance and give up once their balance sheet shows an overall loss in revenue. Most businesses lose money till they make money. Nobody can define how and why a business fails.

[Chris S]

I believe it was Malcolm Gladwell that said that the "outliers"--those that are extremely successful without contributing a lot of work, did so due to luck. All other successes, he argued came from hard work and persistence.

I thought Gladwell's argument was the exact opposite. I remember watching a video where he said that the outliers were the very persistent ones. Something about it taking 10,000 hours to become great at something.

Either way, I agree with your argument in general.

I find that the harder I work, the more luck I seem to have.

-Chris S

[mwormald]

The question should not be why businesses fail. The question should be why businesses are sucessful. Be focused, driven, and find amazing people to work with.

[clabrat]

The business would also need teamwork and collaboration. Through collaboration, trust, respect, honesty, and consistency are nurtured.

Teams that effectively communicate and collaborate with each other generally have four reoccurring themes based on trust.

1. Trust allows team members to stay problem focused.
2. Trust promotes more efficient coordination and communication.
3. Trust improves the quality of collaborative outcomes.
4. Trust leads to compensating.

To read more, please visit my site at Eight Hour Journey.com

[oneBIGwave]

Businesses NEVER fail, management fails.

Not true at all. Not at all.