Business failure among small-scale entrepreneurs

[freedomgo]

Perhaps of the many young entrepreneurs, only a few can really successfully run their businesses. They are the ones who can learn from anywhere to gain more knowledge and also often try trial and error in business so they can find the right formula for them. Each entrepreneur must have their own formula so that their business can run well and if they get a formula from someone else on how to run their business, they have to adapt it to their circumstances. It will be better because they can find what works for them and help them achieve success.

These young entrepreneurs may not gain instant profits from their businesses for sure, they certainly have gained lot of losses at first. But business is business, if you can’t stand from your losses and you won’t be able to recover from it, your business will surely bound to fall. However, only few of them managed to overcome the trials and continue to experience business prosperity. The reason might be they have built good strategies throughout the years to run their business successfully and they were able to meet the demands of their regular and new customers.

[1714505492]

1714505492

[Vaskiy]

In my country a big number of startups got into existence as a result of some schemes initiated by the government. Later this turned to be mere schemes and the government failed to provide consistent support in all levels, particularly in finance. This have caused a big percentage of startups end and very few are sustaining. The governments have got big responsibility in the development of the people through entrepreneurship. Most of the time government work for the corporate that are once a strat-up.

[Vaculin]

I agree that there is a good reason why we can't really understand what could happen for us to fail, but we need to realize one huge and important thing, which is debt. Most of the companies that you see end up working towards the fine line between bankrupting and success, because they spend everything they get to grow, and that causes companies to be always in trouble, one big mistake and you are done because you can't pay for that mistake without getting paid and if it's a mistake you can't get paid.

Even Tesla and Amazon had this, they had plenty of times when it looked like they would fail, and instead they ended up working out but it was very close for both of them at times.

When you started a business from a debt, its hard to expect initial success from it because all you will prioritize is to pay the debt first  and after that, that's the time you can completely focus to make your business grow. Sad to say, even big entrepreneurs engaged in debt, some have managed to secure finances more than paying their debt while others end up in bankcruptcy due to unable to secure profits and unable to pay their debt.

[dothebeats]

To be fair, owners of these startups have huge balls to begin their operation in industries that are either overly saturated or no business has even been yet. In school, we are taught that 90% or even 95% of these startups are doomed to fail, either because of mismanagement, tight competition, or both. Those who managed to break out of the norm gain some success, and it's still a very crucial point for them because they are expanding and they are using more resources than ever.

In my country a big number of startups got into existence as a result of some schemes initiated by the government. Later this turned to be mere schemes and the government failed to provide consistent support in all levels, particularly in finance. This have caused a big percentage of startups end and very few are sustaining. The governments have got big responsibility in the development of the people through entrepreneurship. Most of the time government work for the corporate that are once a strat-up.

The government would only love working for those big businesses because they bring in more money. Banks and governments can even bail these big businesses out if they needed to, because they needed that extra boost from those huge corporations. Startups are always left to fend for themselves but in a business and practical standpoint, it's better to throw money on something that already proved something and is still capable of profiting rather than throw money on something that is highly uncertain and hasn't proven anything yet.

[Gallar]

I'm sure the companies you mentioned above also must have planned and designed a good plan and must have been careful,
but in the end they closed or went bankrupt, why?

I explain, there are also two types of bankruptcy

- due to financial failure
- due to economic failure

financial failure
caused by the company lack of cash or capital funds for operational activities. To prevent this financial failure, the company can use some of the asset liability management.

economic failure
This is because the company loses revenue so that it is unable to finance its operational costs, meaning that the company's profit level is much less than the cost of capital or the value of the company's cash flow is smaller than liabilities.

and that triggered the failure above that
caused by
- Wrong financial management
- lack of innovation
- Lack of capitalization of funds
- Putting trust in the wrong people
- the company has too much debt
- the point is less thorough and careful in every action.

[Bitstar_coin]

The competition is high and there is a huge monopoly that prevents new startups to succeed. Only when the government move to end this monopoly (particularly in Africa) will startups able to survive.
The cost of production as a startup is very high because of limited capital, unlike the big businesses who can get same materials at a huge discount from buying in bulk.
Then there is government policies which are too stiff for startups to meet and at the end 90% will not be able to survive.
The government has a big role to play for the survival of small scale business otherwise the story will remain the same.

[South Park]

The competition is high and there is a huge monopoly that prevents new startups to succeed. Only when the government move to end this monopoly (particularly in Africa) will startups able to survive.
The cost of production as a startup is very high because of limited capital, unlike the big businesses who can get same materials at a huge discount from buying in bulk.
Then there is government policies which are too stiff for startups to meet and at the end 90% will not be able to survive.
The government has a big role to play for the survival of small scale business otherwise the story will remain the same.

You are bringing an important point, when it comes to tech companies there are huge monopolies that governments simply do not touch out of convenience as they are working hand in hand to obtain information from their citizens that way, and as such new projects have almost no chance of competing against them, and even if they could those monopolies end up buying them anyway, so until something is done about this it is going to be very difficult for small startups succeed.

[doomloop]

The competition is high and there is a huge monopoly that prevents new startups to succeed. Only when the government move to end this monopoly (particularly in Africa) will startups able to survive.
The cost of production as a startup is very high because of limited capital, unlike the big businesses who can get same materials at a huge discount from buying in bulk.
Then there is government policies which are too stiff for startups to meet and at the end 90% will not be able to survive.
The government has a big role to play for the survival of small scale business otherwise the story will remain the same.

You know what that competition causes? The lack of profits and only the aim of growing their worth. Because these days companies do not want to aim at making a profit, they aim at being worth a lot. If you have zero profits, in fact if you are making bigger and bigger debts and growing your losses bigger, but if your companies networth grows bigger than your debt? That's fine.

So, let's assume you have a company worth 10 million dollars but have a debt of 5 million, that's fine, and if you grow and have 20 million networth but 10 million debt that's fine and you could keep growing like that. "Exit strategy" is a term that grew too big, and that causes them to fail.

[Russlenat]

Perhaps of the many young entrepreneurs, only a few can really successfully run their businesses. They are the ones who can learn from anywhere to gain more knowledge and also often try trial and error in business so they can find the right formula for them. Each entrepreneur must have their own formula so that their business can run well and if they get a formula from someone else on how to run their business, they have to adapt it to their circumstances. It will be better because they can find what works for them and help them achieve success.

Its not undeniable that those who stay for long in the business whether it’s small scale or big time businesses have their own formula or strategy that makes them successful. That’s one thing that make them overcome all their struggles because they have a working strategy or formula that sustain the business profits. Otherwise, if they keep on failing, then it’s hard to see entrepreneurs last long in the business industry.

[gantez]

Mismanagement of Funds
Some small businesses fail because the owners mismanaged the business funds and there was no accountability.

Funds are the problem that business go through may be mismanagement will course it to close up or it is in shortage of fund. Small business owners most times lack professional knowledge to run them and don't have fund to higher good workers that will help to move the business into another level. They can't secure loan from bank to finance the business and gradually it go down when the owner is late.

[Jatiluhung]

It's a shame indeed, when a business that has been built with great difficulty actually has to fail in the end, even though they actually had a boom at the beginning of their existence.
and at the beginning of their presence they carried out promotions so vigorously. so fans keep coming.
but unfortunately the promotion they do is not developed or too monotonous. so people get bored and switch to other options.

we also need to know to make a business so that it can survive in a very tight competition then there are several things that need to be our focus such as:

1. Consistent in running the Promotion.
Even though our business products or services have been widely known, it does not mean we have to reduce the level of promotion of our business. because if we look at big companies like Amazon etc. we can see their promotion continues to be done consistently. because they know they need new customers every day.

2. innovate and adapt to the trend.
whether small business or big business, if they cannot adapt and innovate by following the trend, it is certain that their customers will run away and will move to another place that understands trends better and has adapted to the environment and trends that are happening.

3. Identify your business competitors.
This is necessary for your own business evaluation material. And don't abuse this by creating a strategy that imitates your competitors. but make a strategy that is better than your competitors. because today's business competition is so tight, this step is a step that must be considered important.

4. Continue to improve the best service to consumers.
making consumers comfortable and addicted to our products and services is the main thing so that a consumer will continue to subscribe to using our services and business products.

and many more of course things that must be done in order to make a business so that it continues to survive in this era of intense competition. please add by all friends.

[blue_hurricanger]

Perhaps of the many young entrepreneurs, only a few can really successfully run their businesses. They are the ones who can learn from anywhere to gain more knowledge and also often try trial and error in business so they can find the right formula for them. Each entrepreneur must have their own formula so that their business can run well and if they get a formula from someone else on how to run their business, they have to adapt it to their circumstances. It will be better because they can find what works for them and help them achieve success.

Its not undeniable that those who stay for long in the business whether it’s small scale or big time businesses have their own formula or strategy that makes them successful. That’s one thing that make them overcome all their struggles because they have a working strategy or formula that sustain the business profits. Otherwise, if they keep on failing, then it’s hard to see entrepreneurs last long in the business industry.

When the market is in recession, people tighten their wallets, slow days of business,... usually small-scale companies go first. It is not really that surprising, considering small-scale businesses typically don't have enough funds to operate at a net loss for a long. So you'll see downsizing, forced to close down for small-scale companies and niche businesses first, big one goes later. Tho, it was also a matter of cutting losses as small-scale ones don't have the potential to sell off themselves to investors like big-scale ones.

[EarnOnVictor]

To become a successful entrepreneur, of course, requires a process and has failed a lot, the big entrepreneur we see today is successful when he tells it, he will say that he has experienced many failures and is almost desperate because of bankruptcy and so on, but with enthusiasm and learning from mistakes they can success.

You sound like a motivator, but business success is beyond that. Many factors have to be considered before success could be made in any business irrespective of the scale of the business. The first and most important of the factors is the resources at hand, are the needed money and human capital adequately available? It is also important to consider the location of the business, you might be entirely a failure if your business is located wrongly or targeted towards the wrong people. While the management of the business is important, the creativity of the entrepreneur, the employee and marketability are also crucial.

[suzanne5223]

I believe the number one reason that causes the failure of any scale business is the location and I think a lot of people don't notice this because I have seen many people doing the exact mistake and believe that having a business concept with capital is what is needed for a business to be successful.
But in the e-commerce business which the OP used as an example what is needed to prevent failure is to welcome innovative concepts and do the needed marketing.

[Punakawan]

In my opinion the hardest thing that makes the business fail is not to know the market so that the results of production cannot be marketed, we must understand the market strategy, namely things that are necessary, most business people have not mastered effective marketing strategies.

[bestcoins1]

To become a successful entrepreneur, of course, requires a process and has failed a lot, the big entrepreneur we see today is successful when he tells it, he will say that he has experienced many failures and is almost desperate because of bankruptcy and so on, but with enthusiasm and learning from mistakes they can success.

Those who are successful now have failed in the past, but I don't think there is a need for too many failures, because when there are more failures in an entrepreneur, he will get worse and take longer to get back up. The success of an entrepreneur is also due to long hard work and never give up and what don't forget is his experience in the field he is in.
Because when he had failed once or twice in his attempts, the third time would definitely not fail again because he already knew where the fault lies in the past which caused him to fail.

[Rockstarguy]

To become a successful entrepreneur, of course, requires a process and has failed a lot, the big entrepreneur we see today is successful when he tells it, he will say that he has experienced many failures and is almost desperate because of bankruptcy and so on, but with enthusiasm and learning from mistakes they can success.

Those who are successful now have failed in the past, but I don't think there is a need for too many failures, because when there are more failures in an entrepreneur, he will get worse and take longer to get back up. The success of an entrepreneur is also due to long hard work and never give up and what don't forget is his experience in the field he is in.
Because when he had failed once or twice in his attempts, the third time would definitely not fail again because he already knew where the fault lies in the past which caused him to fail.

Their is no successful business without failures, but as far as one is doing the right thing in business and putting good attention to the business it definitely be successful. Reasons why most businesses don't do well is because people fail to give attention to their business.
Failure in business will always take place but when one is comfortable with the falure and not trying to make some adjustment to correct certain mistakes that means the business won't survive.

[iv4n]

All these reasons show how bad the team behind the project actually is! The team leader didn't choose the right people, they didn't manage to connect and that's why the job went bad! The most important part is how the people behind the business do their job, from the boss to the doorman... if the doorman is scary he will push people away!

People who start from scratch have to give up free time, in most cases even time for the family! Until the business starts bringing something back it's work day and night, literally! Some of my closest people have businesses, they started from scratch, and only after 5+ years they have a bit more free time. Simply, some people don't have the dedication and courage to risk (to risk much more than money in some moments) in order to create a business, and that's why they fall into the water as soon as the first storm arrives!

Bottom line is that if you don't try you will not know! If you try you need to think about many things and be brave to take some risks, nothing comes without that.

[milewilda]

To become a successful entrepreneur, of course, requires a process and has failed a lot, the big entrepreneur we see today is successful when he tells it, he will say that he has experienced many failures and is almost desperate because of bankruptcy and so on, but with enthusiasm and learning from mistakes they can success.

Those who are successful now have failed in the past, but I don't think there is a need for too many failures, because when there are more failures in an entrepreneur, he will get worse and take longer to get back up. The success of an entrepreneur is also due to long hard work and never give up and what don't forget is his experience in the field he is in.
Because when he had failed once or twice in his attempts, the third time would definitely not fail again because he already knew where the fault lies in the past which caused him to fail.

Their is no successful business without failures, but as far as one is doing the right thing in business and putting good attention to the business it definitely be successful. Reasons why most businesses don't do well is because people fail to give attention to their business.
Failure in business will always take place but when one is comfortable with the falure and not trying to make some adjustment to correct certain mistakes that means the business won't survive.

Any business does really experience failures but we know that failures could really be having different extent on which there are some who could able to recover and there are some who do totally die.
It would really be just that normal that you would really be needing up on making adjustments for you to correct on what you had done wrong.Although there's really no assurance when it comes to success.
You wouldnt really be able to stop things whether it could really be the end of your business or you could really still able to recover it.Mistakes and errors are common
but as a business owner then you would really be striving your best on standing on your feet.

[batang_bitcoin]

I'm sure that those failed companies have came to a time that there's a bigger company that wants to acquire them. But, as they think that they're at the top of the world, they declined those acquisition offers. Everyone should learn who's into this type of business and endeavor that when a bigger company offers such acquisition, they'll just have to grab it and work for something else. It will make give them connections and will open more opportunities upon doing so.