Common Reasons of Business Failure

[Ayokex]

So many businesses due to lack of proper planning. To fail to plan in business is to fail in business. A business that will stand the test of time has to be well planned out. Many other reasons might be responsible for business failure some of which may be not paying careful attention to customers demands. Attitude of the employees is also a vital factor that may responsible for business failure. How are the employees relating to customers, how are they treating them and meet their needs?

 

[Adegbindin Abdullahi]

business failure are caused by different factors like unimproved advertising,low knowledge of interactions between the customers high taxation ,Poor management , high interest rate on product can also be caused by insufficient capital and mismanagement of the company funds

 

[Kelly5]

Unfortunately we can say that there are a lot of businesses today that goes to failure, it is because they lack factors that needs to be observed. Anyways let me provide you some common reasons of business failure.

a. They may not know how to win over clients
If a company doesn't know its clients well or treat them well, there is no point in improving lead generation. Winning customers over begins with knowing the preferences of consumers and tailoring goods to suit those desires and needs. Treating clients well begins when it comes to customer care by adopting best practices.

b. They don't know how leadership can be given.
With a bold vision, leadership is about inspiration and empowering the troops. It begins with developing partnerships by helping individuals inside the organization achieve their goals. Leadership is important; it is difficult to make good decisions or take successful actions without it. Leadership influences every part of an organization, from how workers function productively to how they manage operations.

c. They don't know how to market themselves.
Marketing does not begin by learning how to use tactics for advertisement and promotion. It begins with the differentiation of products. All its marketing efforts would be wasted unless a company can explicitly state why its product is different from others similar to it in the marketplace or come up with a specific value proposition.

I am very much sure that any of these reasons are correct, and how about you? Please let me know your thoughts on the comment section.

You have really written a lot on the reasons for business failures. A lot of factors can lead to business failure. Factors like somebody being ill equipped for starting a business will definitely lead to business failure and a whole lot of stuffs.

 

[Felixko]

The most common reason why business leads to failure is, lack of Knownledge about the business an individual is to star. This implies that, research should be done by the individual in enable to help him or her for where, how and when to run the business.

 

[Lekan]

You are right that the most common reason why business has failure is that is not all people that has the knowledge of running business but they will want to do photocopy and they don't know that to start a common business you will have to receive some knowledge from other business man.

 

[Ziki]

Some companies are pretty good at incubation. They're perfectly willing to spend money to come up with new ideas. The problem comes when these businesses begin to scale and it takes serious resources. When that happens, suddenly these senior executives who are all in favor of innovation suddenly realize that to develop new businesses, they may, in fact, have to sacrifice some short-term profits. That's when many CEOs suddenly step back and say, maybe not.

 

[Seun4luv]

Firstly, Failure to deliver real value and failure to connect with the target audience. Secondly, Starting With Too Much Debt and No Business Plan. Thirdly, Mismanaged Cash Flow and impatient.

 

[.V.]

I think one of the most common reasons for business failure is extravagance and/or unnecessary spending. A business owner may end with heavy losses if he or she is extravagant.
Wise spending is an essential trait to attain for a business to flourish.
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I think one of the most common reasons for business failure is extravagance and/or unnecessary spending. A business owner may end with heavy losses if he or she is extravagant.
Wise spending is an essential trait to attain for a business to flourish.

 

[Hassan14]

Unfortunately we can say that there are a lot of businesses today that goes to failure, it is because they lack factors that needs to be observed. Anyways let me provide you some common reasons of business failure.

a. They may not know how to win over clients
If a company doesn't know its clients well or treat them well, there is no point in improving lead generation. Winning customers over begins with knowing the preferences of consumers and tailoring goods to suit those desires and needs. Treating clients well begins when it comes to customer care by adopting best practices.

b. They don't know how leadership can be given.
With a bold vision, leadership is about inspiration and empowering the troops. It begins with developing partnerships by helping individuals inside the organization achieve their goals. Leadership is important; it is difficult to make good decisions or take successful actions without it. Leadership influences every part of an organization, from how workers function productively to how they manage operations.

c. They don't know how to market themselves.
Marketing does not begin by learning how to use tactics for advertisement and promotion. It begins with the differentiation of products. All its marketing efforts would be wasted unless a company can explicitly state why its product is different from others similar to it in the marketplace or come up with a specific value proposition.

I am very much sure that any of these reasons are correct, and how about you? Please let me know your thoughts on the comment section.

Most business people fail because they do not take much interest in their business and borrow more, which makes it very difficult to repay and the tension remains with them and they fail. And I think debt is the most important factor in every business failure.

 

[Victor-t]

Business fail for different reasons. To some, it is improper planning, to some, it is shortage of funds due to inflation. Some also fail as a result of bad weather, while some also fail due to outbreak of diseases. Government policies sometimes cripple some businesses.

Some of the common reason why business failed is that, lack of producing quality product, lack of deep understanding about the product, inadequate knowledge about the product producing.

 

[Nma]

most businesses fail as a result of improper planning and indiscipline..... some business owners are lazy and do not take their businesses seriously... They just fold their arms and sit expecting the best outcome from their various businesses.... unfortunately life doesn't work that way

 

[Abbas007]

The biggest reason is the failure to understand and talk to what you are selling.
You must clearly state your value proposition. What value am I offering to my customer? Once you understand it, ask yourself if you are talking to it effectively. Is your market connected to what you say.

 

[Diamond07]

A business is likely to fail if there is poor financing or no financial management. Then again if a business is not in touch with customer needs to as to solve thier problems it is likely to fail

 

[Damismiling]

The most common reasons small businesses fail include a lack of capital or funding, retaining an inadequate management team, a faulty infrastructure or business model, and unsuccessful marketing initiatives.

You are very correct some common reasons why small business fail is always number one lack of capital for expansion. I have also noticed that most small business owners mismanage their fund and dont properly manage the business

 

[Nimra Noor]

There are many reasons may be don't have coordination between boss and employee or not giving proper time to business or decrease the quality of your products means that don't now remain same as in starting

 

[Robrown83]

You really have good points but I believe the major reason is how to treat your customers that is customer relation. If any business lack this surely it will fail. Meanwhile, if a customer is not satisfy with a company, he can discourage 1000 customer not to patronize it vice versa.

 

[Xerryl]

This mostly affects young entrepreneurs who are not prepared to do business. That is why it is important to have a mentor, an expert in the same business line to advice you on steps to take.

 

[Denuola]

1. They don’t know how to plan.​

Lack of planning is when you ignore the value of planning and don’t bother to learn the methodology of planning. A good plan should include both short- and long-term goals as well as a way to measure goals and results. It should also have clear to-do lists, benchmarks, and milestones.

2. They don’t know how to provide leadership.​

Leadership is about motivation and inspiring the troops with a bold vision. It starts with building rapport by helping people fulfill their aspirations within the company. Leadership is essential; without it, it’s hard to make good decisions or take effective actions. Leadership affects every aspect of a business, from how productively employees work to how operations are organized.

3. They don’t know how to manage people.​

Failing to manage people arises from failure to listen to suggestions or complaints, micromanaging, and providing harsh criticism under the guise of constructive feedback. This not only lowers employee morale, but it also lowers productivity and teamwork.

4. They don’t know how to market.​

Marketing doesn’t start with learning how to use advertising and promotional strategies. It starts with product differentiation. Unless a company can clearly state why their product is different from others similar to it in the marketplace or come up with a unique value proposition, all its marketing efforts will be wasted.

 

[Thosynho]

There are several reasons why a business may fail, but the most common ones I've noticed or read about are:
Poor management skills, most business do not implement right attidute towards their staffs and customers and this may affect the business negatively.
Inability to compete with other similar businesses, when a business remains stagnant with no improvement to meet u pool with the others, the business is likely to fail.
Lastly, insufficient marketing.

There are several reasons for business failure. One of it is over confidence in business. Many entrepreneurs believe in their knowledge over the business and have seen themselves as all knowing by this one single error can make them fail.

 

[Lyrrex]

one of the common reasons why a new small business fail is as a result of lack of proper planning. A lot of young entrepreneurs jump into business without learning the rules of the business and they end up crashing at the middle.