There are risks involved in making decisions, including the decision to start a business.
Various risks can occur and the most avoided by entrepreneurs is failure. Actually, failure is avoided by everyone, yes.
But in business there are several factors that can cause failure. Of course, if you want to start a business, you must avoid the causes of failure.
There are 5 main causes of failure in business as quoted from: Moe Nawazlet’s just get to know the various causes.
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1. Inexperienced management team
A successful business must have a good management team. No wonder a bad management team is one of the main causes of business failure.
A company must have goals and a future vision and mission for the company, but what’s the point of having a goal if you don’t have good management to manage the company.
Many people are promoted to promotions simply because of good behavior, not because of their expertise in managing the company.
If necessary, you can make notes that contain what steps need to be taken. Indirectly, this will really help you to achieve company goals.
2. Not controlling the spending of money well
In every business, money is indeed the most important and can be a benchmark in the success or failure of a company.
The money owned by the company must be managed and controlled properly, therefore financial cash must be owned.
Uncontrolled income and expenditure of money will make the company’s finances weaken and eventually go bankrupt.
If you still don’t understand about financial matters, try to find an accountant who is an expert or you can learn self-taught.
3. Out of focus
Because there is a lot of work that needs to be done every day, it makes you focus too much on some of these jobs so you don’t focus on the development of the business you are living.
Especially if you only focus on one job which will make other jobs neglected. Try to divide your focus in the right way.
In a day there are generally 10 hours for someone to work. Divide the hours to get some work done. Keep in mind, you have to be consistent in doing it so that time is not wasted.
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4. Don’t know about competitors
Many people underestimate competitors so that their efforts fail and eventually competitors dominate the market.
Try to find out what their products, services and pluses are. Look at the shortcomings of the business you are running when compared to them.
Find out what customers usually like about a competitor’s product or service. Because the more you know more about your competitors, the more benefits you will get.
5. Not doing market research
Times are always evolving and like it or not, your business must also keep up with the times. If not, your business will be left behind by many customers and eventually go bankrupt.
Always find out the latest market conditions by doing research. Because by doing research, you will find out what the market needs and wants right now.
Doing market research is also not as difficult as one might think. You can find out through television, radio, internet and so on.
Now you know what causes a business to fail, right? Well, it’s best for those of you who are just starting to do business, avoid the various causes above if you want your business to run smoothly.