20 Causes of Small Business Failure

20 Causes of Small Business Failure

 

20 Causes of Small Business Failure

20 Causes of Small Business Failure

Small business produce in wholesale and they die also in bulk. It is because without much of funds, skills and formalities one can very easily recruit a small business even for self- employment. After the easy opening the owner and his deputies as do not take much care most of these unit face troubles leading to premature closure. The cause of such impulsive closure of most of the small businesses are provided as below:

1 Starting without planning.
2 Inventory mismanagement.
3 Having the wrong arrogances toward business and its attention groups.
4 Unintentional enlargement.
5 Starting with too much capital and being unconcerned in its use.
6 Starting with very little capital.
7 Lack of time of management.
8 Not starting with small scale, or starting without market test.
9 Starting small business in wrong location. As location is very important to start a small business. For example- Dress showroom, beauty care center or can be barber shop.
10 Getting too much bank loan. To start it is important to get bank loan, but do not borrow too much.
11 Not allowing unexpected expense.
12 Expanding credit too.
13 Too much investment going into fixed assets.
14 Poor management. A successful management can change a company to get success.
15 Starting a small business without reason.
16 Do not record startup cost.
17 Starting a small business with very low experience.
18 Attempting to do too much business with too little capital.
19 Lack of proper planning.
20 Too less patience

 

Starting a business is a dream to all young entrepreneurs. I strongly believe, if you analyze these reason you will not failure in your business. I also believe the key to success in business is planning, planning and planning. When you choose a business idea then you should also analyze its advantage and disadvantage. All the best for your success.

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