|
Article Directory
|
+ Authors
+ Articles
|
|
|
|
Top Ten Startup Mistakes That Almost Always Lead to Business Failure
Copyright (c) 2010-2012 K. MacKillop
(See This Article in its Original Format.)
Many startup ideas fail to ever be launched and many, many fail within the first year or two. In most cases, the failure has nothing to do with the business idea, but how the business side is handled. The business of entrepreneurship is business first, then operations (what your business actually does). The Top Ten startup mistakes that lead to ultimate failure are:
1. Insufficient Startup Idea Development -- Most startups do not fail because the business idea is bad. The problem is that many first-time entrepreneurs fail to actually plan the business before sinking cash into the startup. No matter how great a business idea is, it can't succeed without detailed planning. Take the time to work through every angle of your business idea. Not only will you have a better grasp of how far your business can go, you will also reduce your risk and prepare yourself to make the best decisions as you go.
2. Failure to Understand and Comply with Legal Obligations -- An unbelievable number of entrepreneurs leave the legal aspects of business startup to someone else or, worse, ignore them altogether. Eventually this failure to comply with legal obligations will come back to bite you...and the outcome can be devastating. Every entrepreneur must understand and secure all necessary licenses and permits, and set up compliance systems for taxes and fees due the local, state, and federal government.
3. Poor (or no) Marketing Planning -- Marketing is the lifeblood of every business startup, and it is more than business cards and a yellow pages ad. A significant portion of your time and expense budget should be dedicated to marketing. Poor or no marketing equals no sales...equals business failure. Do your homework before you launch to identify your target markets, figure out how to best reach them, and establish clear objectives and evaluations to ensure your marketing efforts are paying off.
4. Poor (or no) Financial Management -- Success in business is all about the bottom line -- no profit, no business. Keeping the books correctly is half the battle. Too many first-time entrepreneurs are willing to turn over complete responsibility for the books to someone else -- a dangerous decision that very often leads to business failure. Reviewing and analyzing the financial reports is the other half. It is critical for every business owner to understand what the financial reports mean and how a change in one area affects all the others. Cash flow issues are also major financial management problem for many startups in the earliest stages. Good planning before launching a startup will clarify how much cash on hand your business idea will need to succeed. Whether you consider yourself a numbers person or not, as a business owner it is critical that you take responsibility for learning and applying basic financial management skills if you want to succeed.
5. Sales Forecast Errors: Establishing your initial sales forecast can be difficult, but there are procedures you can follow to make it as realistic and accurate as possible. All too often would-be entrepreneurs build a sales forecast around what they would like to sell, rather than what they are likely to sell. While optimism is an excellent entrepreneurial trait, an overly optimistic sales forecast will leave you with serious cash flow problems and even greater difficulty in securing financing.
For example, one business plan we recently reviewed appeared well-written and professionally laid out. However, the sales forecast reflected sales that required every member of the staff to bill out 19 hours per day, 300 days per year. Another retail business showed average total purchases at $230 each, even though the average price of their products is only $12. Assuming that each customer will purchase an average of 19 items each time they visit is unrealistic. Any competent investor will look for these errors.
6. Under-Capitalization: Not starting with enough capital to support the business through the initial stages is a common error. By thoroughly planning your idea, you will know how much capital you need to cover while you build your customer base, including working capital to keep yourself in ramen noodles until your business takes off. Good planning will also increase the chance of securing investors, whether public (banks) or private (family and friends).
7. Poor Web Presence: An effective web presence is an absolute must for any modern business. Simply posting a website is not enough. In fact, uploading a website without marketing it is like posting ad copy only in your own living room -- if your target market doesn't see it, it might as well not exist. Many recent startups have crashed and burned because the entrepreneur thought that simply posting a website to the internet would drive sales. It won't.
8. Leaving Critical Tasks "To the Professionals": Many entrepreneurs believe that a good idea and solid operations are enough to build a successful business, so they opt to turn over critical startup tasks, like marketing and accounting, to outsourced professionals. For some, the business side of business just doesn't interest them, so they choose to forgo learning the details of financial and marketing management. Eventually, these choices backfire. If you don't know how the money works, you can't make the best decisions for your business. If you are not aware of the outcomes of your marketing efforts, you can't accurately forecast sales and thus can't plan for the future. It's your business, you need to know and understand every facet from the beginning, or you might as well be working for someone else.
9. No Ongoing Planning and Review: As the actual operations of a startup take up more and more of an entrepreneur's time, it is very easy to overlook the critical tasks of reviewing and planning. Every aspect of a company should be reviewed periodically, particularly the financial statements and marketing plan. If you don't know where you are or where you have been, it's impossible to know where you are going.
10. Lack of Patience - Pit of Despair: Every startup experiences a period of time between being ready to sell and actually building the sales. We call this gap the Pit of Despair because the entrepreneur is left wondering if they have made the right decisions and whether the business is ever going to work. Many startups hit this point and the entrepreneur quits in frustration. Startups don't generally succeed overnight. The Pit of Despair should be used to refine internal systems, work through free internet marketing techniques (participate in relevant forums, write and publish articles, build website content), and plan for the future of the business. Don't let the inevitable delay destroy your chances of success -- plan for it, expect it, and use the time wisely.
For the most part, a strong focus on the three keys of startup success (planning, marketing, and financial management) will overcome most of the common reasons for business failure. Pay attention to the details from the beginning, learn all you can about running your own business, and don't let anything get in the way of building your business into the thriving company it can be.
|
K. MacKillop, a serial entrepreneur, is founder of LaunchX and authors a small business startup blog. The LaunchX System includes step-by-step business startup procedures, small business software and more, to help entrepreneurs start a business based on their idea and avoid these top ten startup mistakes. Visit http://www.LaunchX.com for a free Business Readiness Assessment and get on the road to starting a business today.
|
Follow "The Phantom Writers" on Twitter
(@phantomwriters)
to be notified when new articles are made available.
VOTE ON THIS ARTICLE
Needs Work >>
0 -
1 -
2 -
3 -
4 -
5
<< Excellent Article
Tell our authors what you think about their article.
|
Top-Level Category: Business Online Articles || Related Categories: Business Offline Articles
10 Most Recent Articles Written by K. MacKillop
The Art of Working A Room -- Networking Skills for Small Business
Written by: K. MacKillop |
Distributed: 2010-02-04 |
Word Count: 1115 |
Page Views: 650
| Votes: 2 |
Rating: 3.00
Mastering the art of effective networking marks the
difference between merely successful entrepreneurs and
captains of industry - the better you are at networking, the
more power you wield. There are a few simple rules to follow
to be successful working the room, and anyone with a little
willingness can learn to be a master of networking.
Women and Social Entrepreneurship -- A Growing Trend
Written by: K. MacKillop |
Distributed: 2010-02-02 |
Word Count: 533 |
Page Views: 671
| Votes: 3 |
Rating: 3.00
Many women are finding that the power and privilege that
comes with successful entrepreneurship make it easier to
make a difference, both financially and by promoting new
ideas. Combining a for-profit business with social activism
provides the best of both worlds. Women who are thinking
about launching a nonprofit should consider the alternative
-- Social Entrepreneurship.
Business Startups with Bad Credit
Written by: K. MacKillop |
Distributed: 2010-01-26 |
Word Count: 734 |
Page Views: 791
| Votes: 2 |
Rating: 3.50
Bad personal credit is a common stumbling block for
entrepreneurs. Working for your self is the best opportunity
for building wealth. While bad personal credit can make the
startup process slightly more challenging, it is not a total
barrier to business ownership and business success.
Hiring Well When Starting a Business Can Be Critical to Success
Written by: K. MacKillop |
Distributed: 2010-01-21 |
Word Count: 912 |
Page Views: 606
| Votes: 2 |
Rating: 2.50
Finding the right employees for your startup is critical.
They will not only be representing your business, but they
will also be representing YOU. Do your homework before you
start hiring, and then hire the best people you can find.
Starting a Business? Should You Choose a Full-Time or Part-Time Startup
Written by: K. MacKillop |
Distributed: 2010-01-19 |
Word Count: 1150 |
Page Views: 552
| Votes: 1 |
Rating: 2.00
Starting your own business is a huge endeavor that takes
quite a bit of time and energy. Many potential entrepreneurs
have a hard time deciding whether starting a business
part-time or full-time makes the most sense for them.
Whatever you choose to do, be sure to develop and use a
time-management system that works for you and ensure that
the time you spend working on your idea is productive. If
you are serious about asserting your independence, you will
find the time to make your idea into reality!
Take Advantage of Federal Contracts for Your Business Startup
Written by: K. MacKillop |
Distributed: 2010-01-14 |
Word Count: 653 |
Page Views: 755
| Votes: 3 |
Rating: 2.33
Getting on board with federal, state or local government
contracts can be a boon to your venture's bottom line.
Spend a little time and effort and open up a new target
market -- the government.
Cash or Accrual Basis of Accounting? Which Should You Select When Starting a Business?
Written by: K. MacKillop |
Distributed: 2010-01-13 |
Word Count: 830 |
Page Views: 2617
| Votes: 4 |
Rating: 1.75
One startup decision that seems to cause entrepreneurs
heartburn is whether to set up their accounting system on a
cash basis or on an accrual basis. Although this sounds like
secret accounting code, the implications are
straightforward, and, for most businesses, the right method
is easy to see.
Starting Your Business Smaller Can Make Your Success Bigger
Written by: K. MacKillop |
Distributed: 2009-12-03 |
Word Count: 782 |
Page Views: 623
| Votes: 1 |
Rating: 5.00
Does your business idea seem too big to take on? Will it
require more startup capital than you can obtain? Don't
give up on owning your own company -- there are ways to
modify almost any business idea into something that can be
started part-time and with less capital than the original
plan. The most successful entrepreneurs tend to be very
flexible and creative in getting where they want to go.
Whatever you decide to do, get started on your planning as
soon as possible!
Every Business Startup is a Series of Unexpected Events - Will You Be Ready?
Written by: K. MacKillop |
Distributed: 2009-12-01 |
Word Count: 847 |
Page Views: 575
| Votes: 1 |
Rating: 4.00
No matter how seasoned an entrepreneur, every business
startup has its share of surprises. Certain personality
traits are advantageous in dealing with rapid changes, and
developing these traits will help ensure the success of your
business when faced with change.
All of Author's Articles on this site: K. MacKillop Articles
Most Recent "Business Online" Articles
Sell Yourself, Not Your Products or Services
Written by: Bill Platt |
Distributed: 2012-01-02 |
Word Count: 989 |
Page Views: 2754
| Votes: 5 |
Rating: 4.00
Sell yourself, not your products or services. The point we
need to make is that your products and services will change
over time as your business adapts to the realities of the
marketplace.
Work From Home - Make Money Online With EBay Store
Written by: David Miller |
Distributed: 2011-12-12 |
Word Count: 2105 |
Page Views: 352
| Votes: 1 |
Rating: 2.00
Find out how to present your items, as well as other key factors
to profit from your eBay Store.
Bring Your Photography To Life With Stunning Video
Written by: Adam Harding |
Distributed: 2011-12-12 |
Word Count: 684 |
Page Views: 458
I want to let you in on my little secret. It is about how I bring
photographs to life by creating professional video slideshows
that look like they cost hundreds of dollars.
Leveraging the Social in Social Media
Written by: Enzo F. Cesario |
Distributed: 2011-09-21 |
Word Count: 907 |
Page Views: 394
| Votes: 1 |
Rating: 1.00
Social media marketing is about the conversation, not the
pitch. Having conversations with people is nice, but the
goal of a brand is ultimately to get people interested in
spending their time or money on the brand, after all. What
does having this conversation accomplish, and just how does
a brand use that conversation to get the critical conversion
from conversation to customers?
Blog Writing - Finding the Right Person
Written by: Enzo F. Cesario |
Distributed: 2011-09-21 |
Word Count: 884 |
Page Views: 630
There are a host of articles and sites covering advice on
how to address various topics, but one area that doesn't
get a lot of attention is what "person" to write the blog
in. Each linguistic person has its own strengths and
weaknesses, depending on the message that needs to be
covered. Ultimately, most will simply write in whatever
person is most natural to them, but there is some merit in
taking a bit of time to think about the implications,
advantages and disadvantages of each.
That First Impression: Title Considerations
Written by: Enzo F. Cesario |
Distributed: 2011-09-19 |
Word Count: 860 |
Page Views: 355
While it certainly isn't as much work as crafting the body
of a superior article, selecting a title for a piece is
definitely an important element of the entire process of
content creation. Here are some thoughts on crafting a
perfect title.
5 Tips For Writing Great Content For Your Blog
Written by: Lee Dobbins |
Distributed: 2011-09-16 |
Word Count: 987 |
Page Views: 405
If you want people to come back to your blog over and over
again, then you need to provide great web content. This may
seem like an impossible task if you aren’t a natural born
writer. Here are 5 tips that will help even the least
experienced writer create blog content that will entice even
first time visitors to become frequent readers.
Understanding Cloud Computing for SMBs
Written by: Audre Hill |
Distributed: 2011-09-16 |
Word Count: 449 |
Page Views: 513
| Votes: 2 |
Rating: 5.00
The buzz about cloud migration, or taking your business to the
cloud, is all over the internet. But the geek speak and sales
hype make understanding the cloud difficult for small and
mid-sized business owners. Read this to clear up your cloud
confusion.
Dynamic Content: Using Analytics to Write Your Blog
Written by: Enzo F. Cesario |
Distributed: 2011-09-16 |
Word Count: 873 |
Page Views: 425
The role of web analytics in setting useful metrics for a
site has been discussed in-depth in any number of places,
but this is far from the only useful function that web
analytic practices can offer. As in any field, a little
thinking outside the box can offer extensive rewards to the
creative researcher. Perhaps most usefully, creative
cultivation of web analytics can help conquer blogger's
block and help a good writer come up with some unique angles
for content they thought they had peaked out on.
Social Media Marketing Tools – Putting Your Finger on the Pulse of the Web
Written by: Enzo F. Cesario |
Distributed: 2011-09-14 |
Word Count: 856 |
Page Views: 343
Social media marketing is the home of successful brand
promotion, and finding the right mix of tools to take
advantage of it has become the defining issue of the modern
brand. Knowing the focus of each of these tools and the best
way to use them is the key to bringing all this power under
control and using it to help promote a brand to its full
potential.
Most Viewed "Business Online" Articles
Attracting Readers to your Book
Written by: Alastair Hall |
Distributed: 2006-05-18 |
Word Count: 708 |
Page Views: 42520
| Votes: 9 |
Rating: 2.11
One of the common and obvious ways to market a self-published
book is having your own website. The harder part is how to
attract your target audience and then convert the sale.
How To Make Visitors Bookmark Your Site
Written by: Cheryl Miller |
Distributed: 2006-10-10 |
Word Count: 536 |
Page Views: 34815
| Votes: 13 |
Rating: 2.38
When visitors bookmark your site it is a sign that you have built
a great website and are pleasing them. Visitors think highly
enough of your site to want to return and possibly tell others
about it. You are not only increasing traffic from your existing
clientele you are encouraging new traffic by means of viral
marketing.
Treat Online 'Guests' With Respect
Written by: Rick Sloboda |
Distributed: 2007-07-27 |
Word Count: 472 |
Page Views: 27199
| Votes: 25 |
Rating: 3.76
Does your website show your customers lack of respect? Review the
following checklist to find out.
How I Got 70,000 Useless Visitors To My Site In One Day! (One Internet Marketer's Analysis of Social Bookmark Traffic)
Written by: Titus Hoskins |
Distributed: 2007-11-06 |
Word Count: 1545 |
Page Views: 23763
| Votes: 8 |
Rating: 2.13
Is social bookmark traffic useless? Is it even worth cultivating
for your site? Can it be used from an online marketing
perspective? Read to discover one Internet Marketer's analysis
of social bookmark/media traffic...
Successful Article Marketers Help Readers Solve Problems
Written by: Bill Platt |
Distributed: 2008-10-29 |
Word Count: 816 |
Page Views: 18813
| Votes: 23 |
Rating: 3.26
Every week, I have the opportunity to speak with people about the
benefits and challenges of using article marketing to promote an
online business. Article marketing is about getting your sales
message in front of potential customers and to get links to your
website. Many interpret this to mean that an article should
directly promote a website within the article, but that approach
is wrong and will reduce one's success using this methodology.
Tips For Building Your First Website
Written by: Benny Tsabba |
Distributed: 2007-05-30 |
Word Count: 1511 |
Page Views: 14634
| Votes: 9 |
Rating: 2.00
New people are coming online everyday. And many of those people
desire to turn their spare time into spare cash. So begins their
journey.
Successful Forum JVs and How To Get Them
Written by: Diana Barnum |
Distributed: 2006-06-15 |
Word Count: 648 |
Page Views: 6635
| Votes: 11 |
Rating: 2.18
The forming of common alliances, also referred to as a joint
venture (JV), happens nearly every day in the business world.
One of the most popular means of linking people up online of so
that they can work together on their projects is via forums,
where people of all levels of business and expertise post in
common threads.
Increasing Productivity In Your Online Business
Written by: Willie Crawford |
Distributed: 2006-06-14 |
Word Count: 1407 |
Page Views: 4327
| Votes: 32 |
Rating: 3.72
Running an online "empire" of approximately 1600 websites and
blogs, selling a variety of products, services and ideas, I
have to be much more productive than the average person in a
"regular job."
Who Else Wants to Know How-To Write an Effective Advertisement?
Written by: Bill Platt |
Distributed: 2011-08-25 |
Word Count: 1431 |
Page Views: 4296
| Votes: 22 |
Rating: 2.59
Webmasters struggle everyday with the question of how they should
advertise their website. There are so many advertising venues; it
is hard to know which is the right venue or the right combination
of advertising venues.
A Recent Issue Of Playboy Revealed...
Written by: Bill Platt |
Distributed: 2010-01-19 |
Word Count: 1658 |
Page Views: 4215
| Votes: 1 |
Rating: 4.00
If you have ever spent money trying to use article
marketing, and you failed to generate any measurable success
with your articles, then this article will show you why you
most likely failed to see your articles generate a solid
return-on-investment for your online business...
Highest Ranked "Business Online" Articles
What Kind Of Backlinks Are Best At Helping Your Website In Google?
Written by: Bill Platt |
Distributed: 2009-11-09 |
Word Count: 439 |
Page Views: 1820
| Votes: 5 |
Rating: 4.80
I was in the Warrior Forum, and someone asked what kinds of
Backlinks are worth pursuing. This is my answer to that
query.
How to Keep Your Article Content Fresh and Interesting
Written by: Craig Ritsema |
Distributed: 2006-08-29 |
Word Count: 699 |
Page Views: 2155
| Votes: 17 |
Rating: 4.18
Webmasters everywhere are constantly on the lookout for fresh and
interesting content for their website. Along with these content
qualities is the requirement that it be unique. Everyone wants
their website to stand out above the others in the search engine
results. So what is the trick for you to keep a steady supply of
this quality content coming your way?
Is Your Business 'Out Of Site'? Employ The Ultimate Marketing Tool
Written by: Rick Sloboda |
Distributed: 2007-01-09 |
Word Count: 445 |
Page Views: 2200
| Votes: 19 |
Rating: 4.16
With the rapid expansion of the digital economy, the web site is
conceivably the most powerful marketing and sales tool you can employ.
Find out what a web site can do for you.
How To Use Your Race To Get Rich
Written by: Herbert Harris |
Distributed: 2009-07-07 |
Word Count: 1407 |
Page Views: 2573
| Votes: 40 |
Rating: 4.05
Amid recent news reports that there continues to be an ongoing
and substantial gap between the net worth of Whites and other
racial groups, it is easy to be distracted and overwhelmed by the
raw data. However, I am immediately reminded of a quote offered
by an economic expert from the past... "There are lies, damned
lies, and statistics!"
Secrets of Domain Parking - An Innovative and Easier Way to Make Money
Written by: John Khu |
Distributed: 2009-02-27 |
Word Count: 484 |
Page Views: 1392
| Votes: 7 |
Rating: 4.00
Using a good domain parking services to monetize expired domain
names seems to be a neglected aspect with a number of domain
names traders. Domain parking is also an unfamiliar concept to
many inexperienced domain name traders. Read this article to
better understand domain parking and how it can be of benefit to
you.
Expired Domain Gains - Simple Ideas to Create an Income Base
Written by: John Khu |
Distributed: 2009-07-31 |
Word Count: 549 |
Page Views: 3232
| Votes: 14 |
Rating: 4.00
You can use a number of simple methods and plans to create a
solid income base that earns a monthly ongoing income base.
For many expired domain entrepreneurs (both full-time and
part time), expired domains offer an opportunity to
supplement their current income with money earned out of
dealing with expired domains.
Sell Yourself, Not Your Products or Services
Written by: Bill Platt |
Distributed: 2012-01-02 |
Word Count: 989 |
Page Views: 2754
| Votes: 5 |
Rating: 4.00
Sell yourself, not your products or services. The point we
need to make is that your products and services will change
over time as your business adapts to the realities of the
marketplace.
The Most Important Ingredient for Info Product Success (is You)
Written by: Judy Murdoch |
Distributed: 2008-04-15 |
Word Count: 981 |
Page Views: 1428
| Votes: 13 |
Rating: 3.92
Last week I was attending a conference and mentioned to someone I
help small business owners create information products. The other
person was very friendly until I said "information products."
Then the temperature in the room dropped about 10-degrees
How To Build A Website That Will Rank Well In The Search Engines?
Written by: Fred Schebesta |
Distributed: 2007-04-23 |
Word Count: 1064 |
Page Views: 2132
| Votes: 9 |
Rating: 3.89
Redeveloping your website can be a real challenge when you assume
your web designers and developers understand search engine
marketing. Unfortunately this is not usually the case. Most
designers are great at making pretty pictures and developers are
great at making great technology. But pretty pictures and great
technology don't necessarily give you great search engine
results.
How to Prosper Beyond Virtual Real Estate
Written by: Kamau Austin |
Distributed: 2006-10-17 |
Word Count: 1263 |
Page Views: 1593
| Votes: 7 |
Rating: 3.86
We explore virtual real estate (VRE) sites as sites primarily
embedded with Google Adsense(tm) or Yahoo Publisher's Network (YPN)
ads.
|
|
|
Article Reprint Rights
|
This work is
licensed under a
Creative Commons
License
You are not required to show the creative commons license notice when you reprint this work.
|
|
Home
for Writers
for Publishers
Article Directory
Article Search
Contact
Get RSS Feed
