At this point I have to say that the answer is yes. There are four main reasons why 85% of all businesses will fail in their first five years of operation.
- Not understanding the impact that the new business will have on the family, both personal and financial: a new business takes the center stage in family life both from a “family time” aspect as well as a “family budget” aspect. Pressure is on growing a successful business, and time and funds that have been traditionally dedicated to the family are now being funneled in a new direction.
- Not having a working plan laced with accountability: the majority of new businesses either do not have a “hands on” business plan or fail to adhere to it. The plan should be the “heart” of the business, and it should be updated at least every six months during the critical, first five year, growth period.
- Not Understanding the financial aspects of running a business: no, it’s not necessary but ideal to have adequate financial reserves to grow a business. I am advocating an understanding of the entire financial system required to run a successful business; that includes, budgets, forecast, and available dollar allocation. I have worked with many successful businesses that started with very little funding. The secret was their willingness to be patient and to learn, understand and implement a proper financial structure.
- Believing that they can do it alone: no one person has all the answers. A support team, an advisory board, a mentor or a combination of the three is critical to growing a sustainable business. Caveats on this point: expensive seminars that promise a quick fix are not a solution, nor are well meaning, but untrained friends.
It’s never too late to implement these four points in an existing business. It requires a desire to fall back and regroup and perhaps suffer a bruised ego in the process, but the end result may well be a solid foundation upon which to grow a business.
To all this must be added a positive attitude and a belief that success is achievable.
I want to extend a personal thank you to all my readers. I look forward to expanding that support in my new virtual consulting business at www.onebizcentral.com .Yes, I will continue to personally answer all e-mails.