Why Businesses Succeed Or Fail
It Has Been Said That Most (80%) Of All Businesses Fail Within the First 5 Years.
That's 4 Out Of 5 That Don't Make It!
So, How Do We Become One of the Survivors?
One Of the Top 20%.
Trusted Business Source, Forbes, Listed 5 Reasons Why Most Businesses Crash and Burn Within the First Half-Decade (Other Than Running Out Of Cash, Which May Be the End Result of One Or More Of the Following) :
1. They Are Not In Touch With Customers Through Deep Dialogue.
You Need To "Walk 1,000 Miles In the Shoes Of Your Customer." In Other Words, You'd Better Have An Excellent Understanding Of Your Customer Base.
Familiarize Yourself, If Possible, With Their Pain, Behavior, Dreams, Values, and What They Are Trying To Accomplish.
Recommended Reading: "The Cluetrain Manifesto." Dialogue Is Everything.
2. No Real Differentiation In the Market:
More and More People Are Becoming Entrepreneurs.
What Are You Going To Do To Stand Out From the Crowd?
Be Distinctive!
Check Out Alex Osterwalder's "Value Proposition Canvas," and Figure
Out What You're Really Offering That Is Different and Unique.
Don't Be Like All the Other Sheep In the Flock.
Be Creative.
Be a Leader!
3. Failure To Clearly Communicate Value Propositions In a Compelling Way.
Remember the 1967 Paul Newman Flick, Cool Hand Luke?
The Chain Gang Boss's Memorable Line Regarding Prisoner Luke (Newman) Was:
"What We Got Here, Is FAILURE To Communicate!"
What We Need In Our Business Is Communication That Is Clear. Concise, and Compelling.
Don't Let Your Business Go Down the Tubes Because Of a Failure To Communicate.
4. Leadership Breakdown At the Top.
We Need To Be Strong Leaders, Whether Our Business Has 1,000 Employees, Or Just Us.
Self-Sabotage Through Poor Decision Making Contributes To Many Business Failures.
5. Inability To Put Together a Profitable Business Model with Proven Revenue Streams.
Be Willing To Experiment, Use a Frugal Marketing Budget, and a Minimum Number Of Products. (Start With One Website?)
Tony Hsieh's Book, "Delivering Happiness" Describes the Early Days Of Zappos.
He and His Co-Founders Basically Began As Poor Man's Affiliates, Posting Ads From Manufacturer's Sites, Buying Shoes At Retail When Orders Came In, and Taking a Loss On Every Pair Shipped.
The Market Research They Obtained, However, Was Invaluable.
Learn By Example.
Don't Be a Victim To These 5 Pitfalls.
Be A Survivor!
Recent Comments
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Another one of your great "smorgasbord "posts Rick ! Your variety will never fail. There are 8 octaves in a melody but INFINITE variations and instrumental takes to create with. Well done!
I always count on Rick to bring back memories of great movies and songs ! It is worth the price of admission !
Excellent reminder on what we need to focus on, Rick!
Very well said...aha, now that's where that quote is from...the "what we got here, is Failure to communicate." I've heard it many times, but not sure if I ever saw "Cool Hand Luke" lol.
Thanks for sharing and have a great weekend!
Best wishes :) ~Sherry
I just finished Delivering Happiness and it is absolutely fantastic and everyone in WA needs to read it. Amazon considered Zappos so much of a threat that it purchased the company for 1.2 BILLION dollars !
Great post Rick !
Thanks brother !
That is about right, 48 years later I found if you do not have the drive plus the knowledge how to invest and what to do with your money to make more money. Then you will not survive no matter what.
Ya right. But the truth is the end of next year will be 40 years self-employed, the rest of those 8 years I worked for 3 other shops.
Now a little history, my dad taught us to put money away and learn how to make it work for you. it is only a tool. The shop was doing great so I bought my first rental house in 1988 and then moved forward with 2 business's which have done very well. so I keep buying more houses and a couple commercial properties.
so yes I am doing pretty good.
and very lucky with hard work to still have it all.
Yes but the problem is I am getting a little tired. still love it just do not know how much longer I can do it. if a rental needs repairs I have a great handyman helper but at the shop I even still have to work with the guys.
Time to slow down Mike, enjoy the fruits of your labor. No one on their deathbed says.............." I wish I had worked longer."
PS - No saying you are going to the other side, just saying time to relax some ! AFTER you finish your son's car !
You will start seeing pictures next week on the car and my wife keeps telling me to sell the business. after this long with it, I would be lost.
No, you won't. Just take all that knowledge and experience and put it out on the web so that others can benefit from what you have done!
You are a self-made man Mike. LOTS of folks would love to know how you did what you did. Just telling your life story would be a website in itself. Give it some thought!
Now, get some rest !
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A great post Rick with valuable reminders, thank you :)
Thanks, Jude. :)