Why are Business Startups Dying| Reasons Why Business Startups are Dying
The worries as to why business startups are dying even before their fruiting stage have become a worry to many.
Having that first brainwave, that initial business motivation, and that genius business idea has little to offer to the success of any business.
In fact, in my little journey through the business world, I have watched many blue-ocean business designs nipped from the bud.
A report by the United States Bureau of Labor Statistics (BLS) shows that 20% of business startups fail during the first two years of opening.
Still, according to this BLS data, 45% pack up during the first five years, and during the first 10 years, 65% throw in the towel. In summary, only 25%, that is just a quarter makes it to 15 years and above.
The question is what happens, why the eventual evacuation of these business startups that would have changed the world if they lasted a little longer?
This article gives a summary of the reasons why business startups are dying and practical remedies to save your business startup.
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Why are Business Startups Dying?
#1. Lack of Flexibility
It’s very easy to establish a startup footprint. But one thing business startup owners forget is that the market changes, there is always what we call a market drift where your business model doesn’t fit into the present need in the market.
Notwithstanding the change in market demand, these startups doomed to fail still stick to their initial business plan and approach, which eventually set the stage for their inescapable failure.
Staying rigid and not observing the market space you occupy is one major reason why business startups are dying.
Keep an eye on the market and be aware of any changes that may be required to your company plan. Being aware of significant trends will give you plenty of time to adapt your plan and remain successful. One simply has to look at the music industry or Blockbuster video to see how successful sectors may shift dramatically.
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#2. Untimely Expansion
There is always this push for business startups to opt for expansion once they see a tiny light in the path of their businesses; this is a pull to downfall.
Expansion shouldn’t be the next stage of a business startup, especially when you are not fully grounded in the business’ nitty-gritty.
Untimely expansion of a business is as good as forcing a toddler who has never crawled to run, you might end up rendering the lad deformed.
If you're expanding the scope of your business startup, be sure that you master the markets into which you'll now be reaching. You understand your new goods, services, and target market as well as you know your present successful business.
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#3. Inadequate Management
One common problem that contributes immensely to why business startups are dying is inadequate and reckless management. You can’t answer the question of “why are business startups dying?” without mentioning the poor managerial approach of startup owners.
Poor management of a startup is often seen in multiple areas which include; business strategy, task execution, and team management.
Failure in business strategy may involve continuing with a product or service that people no longer appreciate in the market; running with antiquated ideas.
Poor task execution involves making silly errors in product development, and delays in carrying out a task or rendering a service, it may also involve implementing an ineffective market delivery approach.
Poor team management is one managerial ill that has wrecked most startups. A well-managed team yields maximum productivity, but vice versa occurs if a team is inadequately managed.
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#4. Bad or No Business Plan
I’ve always been an advocate of crafting a realistic business plan because this is the foundation of a startup’s success. Failure to do so is one of the reasons why business startups are dying.
In the business plan, you have the freedom of listing, your business goals, visions, the problems you will encounter in the journey, and the solutions you will employ at every stage of business growth.
Through survey and research, the plan helps you understand if there is even a need for that business in the first place. You will also figure out the cost requirement of the business as well as the financial strategies you will implement.
Be sure to stick to that plan once you draft it, although that doesn't mean rigidity at all.
If you eventually and unnecessarily start changing figures and strategies, then such action will hasten the pace of a sudden land crash.
The more errors you make, the more expensive your business startup will become and the more likely it will fail. You may also be required to tilt if market conditions change dramatically, reducing your prospects of success based on your initial company strategy. In this situation, you return to your strategic plan and completely revise it depending on the tilting decision.
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#5 Poor Financing
There are no two ways about it, you need money to make money. Poor financing is one major cause of why business startups are dying before the time.
If you are realistic in the beginning, you may plan to start with enough money that will last you until the point where your firm is up and running and cash is actually flowing in.
Attempting to stretch your funds at the start may result in your business never taking off, and you'll still owe a lot of money. Lean management strategies are very important at this period, although they may also be used afterward. Consider many funding and financing avenues. Learn about this topic and be creative in your hunt for alternate sources of funding.
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#6. No internet Presence
Believe it or not, the world is not as it used to be, we have evolved. The majority of people depend on the internet for the products they need and the review of such products.
No internet presence is one major factor why business startups are dying. Though you may think that people have come to the understanding of the need for an internet presence, but that’s not true.
Some still cling to the old method of publicity, but Nowadays, your digital presence and social media presence might be just as significant as your company's physical position in a shopping center.
How can Digiweb Developers Help your Business Startup Grow?
Digiweb Developers company is equipped with world-class software engineers, digital marketers, and website designers.
At Digiweb, we offer digital solutions to all forms of businesses and our services are top-notch. We help you secure a strategic space in your niche, connecting you to billions of people all over the world that are searching for your products and/or services.
Our prices are competitive, and we offer software solutions that fit perfectly your business alone. The growth of our clients has always been our integral motivation, and you can get in touch with us today.
Conclusion on ‘Why are Business Startups Dying?’
In summary, the major causes of the death of small businesses are their inability to flow with the trends, their lack of understanding of their business niche, not having a proper business plan, and many more.
A business startup that overcomes all these hurdles will definitely live long to witness the fruiting stage and don’t forget that Digiweb Developer can help you achieve your goals quickly.
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