Creating your own company/startup can be an exciting endeavor. However, there is a 90% chance that your startup will fail according to Forbes.
That’s why proper planning and avoiding the traps that so many new businesses fall prey to is critical to your success.
Today, I want to address five reasons that your startup will fail (and what you can do to avoid failure).
1. You Know It All
Know-it-alls can be a pain in the …
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Not only will business know-it-alls refuse to listen to advice, they also think they can do everything. If you fall into this category, we wish you the best.
No one is great at everything, no matter how much you may believe you are.
We all have weaknesses somewhere, and acknowledging your shortcomings and finding people who are strong where you are weak is critical to building a successful business.
Do not try to run a startup with a know-it-all attitude. Instead, try to figure out where you are weak at and bring can help to strengthen your company. Yes, it will cost you money, but it will be worth. If you do not want your startup to fail, get past the idea that you were the only one who can make this company succeed.
2. No Marketing Plan
Another reason most startups fail is the lack of a true marketing plan.
While Facebook is a good advertising platform to work with, just saying “We’ll advertise on Facebook” is not a marketing plan. It’s a marketing idea.
The fact is that some startups believe in just “winging it” and their plan is to figure things out as they go.
I’ll bet most of those are in the 90% failure pile.
If you do not have a solid, well-planned marketing strategy, stop reading this article right now and work on a marketing plan for your business (Hubspot has some free templates you can use). Once you have a marketing plan in place, come back and finish this article.
Customer service, customer experience, and brand identity is where so many startups focus, but if you don’t get boots in the door that’s all for nothing.
3. Lack Of Customer Service
Contrary to what you’ve heard, your customer may be wrong.
Still, it’s important to give them professional customer service. You cannot let a bad day cost you potential customers (including friends of a bad customer).
If you are unwilling to go the extra mile for ANY customer, then there is no chance your startup will succeed. Businesses do not make money shunning customers; they make money selling products and/or services. Never let a bad customer cost you future business (and they can).
If you have bad customer service, you will not succeed.
4. You Do Not Look Professional
I’m not talking about how you dress day-to-day here (though that does matter).
Instead, I’m talking about putting your best foot forward from a business standpoint. If you don’t present in a professional manner on:
- Your website,
- Your marketing materials, and
- Your communication channels,
then you’re basically dead in the water
Your website MUST be free of grammatical errors and unprofessional statements, your marketing presentation should be clean and concise without a lot of technical jargon used to inflate your company, and your communication channels have to be business-oriented.
By business-oriented, we mean your email address should end with an @yourdomain.com instead of @yahoo.com, @gmail.com or @hotmail.com. According to Suitebriar, you can get professional Gmail for as little as $6/month with no annual contract, so go do that before you start emailing clients.
While we are at it, you should also consider getting an 800-number rather than a local number … unless your business is exclusively local.
5. No Money
Without money, it will be almost impossible to market your product/company effectively, provide proper customer service and/or products, and look like you know what you are doing.
We are not saying that you have to have a TON of money, but you need to know how to manage your funds and use the money you do have effectively. In fact, you should spend the majority of your funds on looking professional and competitive. After that, should focus on your marketing plan and customer acquisitions. As you grow you can get your lean office better equipped and reward those employees who were there to help build your business from nothing.
When the money runs out, so will your startup.
If you want to get past the startup phase, then you should pay attention to the factors I’ve covered today. While these points of failure for startups are somewhat common, they tend to get repeated a lot … so it’s worth taking the time to read, and re-read these common mistakes that cause startups to fail.
Success only comes when you do what others could not … so start winning!