Why Businesses Fail - and How to Make Sure Yours is Not One of Them!

 
Did you ever wonder why such small minorities of businesses succeed and the majority fails within first 2-3 years? Here are my ideas.

 
Lack of knowledge   - If you have an idea for a product or service but no idea how to go about bringing it to market, you must either learn everything you can about that industry or hire someone who does know to help you navigate the unknown. Either way, you must have an intimate knowledge of your product or service and the industry you are about to enter. You also need the specific knowledge about how business works. If you don't learn the skills needed, you had better have the money to hire them.

 
Lack of experience - If you want to begin a business, but need to learn more, you must get your education on someone else's dime. By that I mean, you'll want to get your on the job training while getting paid by someone else. You must learn all the ins and outs of that business before you decide to pony up all your money and resources to start a business you know nothing about. One of the biggest mistakes I see people make is not having the necessary experience. They try learn as they go and then go it alone. To succeed, you must have someone with business experience on your team-a consultant, an experienced family member or friend, or a coach or mentor.

 
Lack of passion - This I believe is the real test because without passion you are almost certain to fail. Why? Because unless you have plenty of passion, when the going gets tough-and it will-you will start to resent the business and that is the beginning of the end. You have to have enough passion to guide you through the rough times, whatever that means for you-months without personal income, plummeting sales, working two jobs, and many other unforeseeable challenges and calamities. The question to ask yourself is this: Why do I want to do this? If it is just to make money, then passion is not your true driving force.

 
Action Steps

1.    Get the necessary knowledge-Take the time to educate yourself. Read books, attend seminars, and listen to audio programs. Continue to educate yourself every single day. I personally like to study the best practices of other successful companies to learn from their experience.

2.    Get the necessary experience - Work in the industry in which you are going to start your business. Hire a consultant who has started several businesses. Get a mentor who has been there and done that same thing.

3.   Take your own passion test - Why do you want to start this business? Get really clear about it. Then ask yourself, Will I do what ever it takes to make this a reality? If your answer to this last one is a resounding "Yes!" then go for it.

 In my experience, you must know what your driving force is and how to use it.

For example my driving force was never the hospitality industry itself, but the freedom to call my own shots in my life. Whenever I balked at doing things I did not want to do, I would remind myself of why I was doing them in the first place. I reminded myself I chose this route to earn a lucrative living in a venture that would preserve my personal freedom. I knew if I didn't follow through with the tasks necessary for my business to survive and thrive, I would be putting my freedom at risk, and that was something I was just not willing to do.