Editor’s Note: Here at Dispatches, we are always looking for ways to help our readers do things. For some of our readers, that means helping navigate the working world, for others, it means assisting in the ever challenging question,“what’s for dinner?” For still others, it means figuring out how to balance family life with everything else. In an effort to aid in all of these endeavors, we have collaborated on this article written specifically for our readers.
The Producers aside, no one starts a business planning to fail. The list below includes some of the most common reasons businesses fail and suggestions for avoiding these pitfalls.
Not enough money
Money is commonly known as the language that the business world speaks. Many businesses start without enough capital. Not enough money can take two forms.
- Undercapitalization which is not having enough money to get your business off the ground properly.
- 2. Lack of cash cushion is actually an extension of undercapitalization. A little bit extra will help pay for unexpected costs that will come your way. It can also be there to help you recover should things go south.
There are many people are there who wouldn’t think for a second that growth could be a bad thing in business. But rapid growth without preparations is a surprisingly common reason for a business to fail. When your business grows, you need to get more employees. You need more product or time for the service. You need to make sure your website can handle added traffic. If all of this happens overnight, then you won’t have been prepared for any of this. If a business can’t afford to keep up with this growth, then they won’t be able to meet demands. The business might overwork employees because they can’t afford to hire more. Customer service will be stretched beyond its limit. Servers could crash because they can’t handle the traffic. T
One of the most common reasons for the downfall of a company? Someone suing them. It’s definitely an ugly way to go out, but it’s a risk you take when you enter the public eye with all these business responsibilities The suit might be from a disgruntled customer.If you have a product, this could be from an injury sustained while using the product. In this case, the consumer is likely protected by the product liability law and without proper planning and coverage, you could owe a great deal of money. Make sure you have consulted with a local lawyer on all legal matter and potential legal issues. The sooner you build a relationship with a representative, the better. If you have an office space and have employees, make sure you have accounted for potential physical injury, you aren’t working your employees into exhaustion, or adding excessive stress. If you make the health and safety of your employees and office a priority, it will save you from internal issues.
Blocking consumer input
A lot of business owners think that they’re paying close attention to customer feedback. But it’s not just a case of reading an email or listening to a comment in order to gauge a general feeling about a product. You need to actively engage in a dialogue with your customers. You and your employees should be spending time getting to know the opinions surrounding your products as much as possible. Take part in phone conversations. In email chains. Speak to your followers on social media. You need to talk to your customers about any potential problems now. Don’t go looking for customer opinions after a few months and thousands of wasted dollars.