Although business is the backbone of the American economy, many people entering into startup business ventures might be heading into unexpected bankruptcy and an inability to give return to their investors, with about 50 percent of businesses making it to the four year mark on average. Some of the most likely to fail industries include information, retail, and restaurants.
Those businesses most likely to still be operating after four years include insurance, real estate, and agriculture. Understanding the common reasons for failure will help you succeed with your latest business venture. Here are some business success tips that will help your business stay afloat, and turn a profit.
Incompetence is the major source of failure, accounting for about 46 percent of all tanking businesses according to Statistic Brain. Specific pitfalls include no financing knowledge, nonpayment of taxes, living beyond means, and emotional pricing. There are a lot of business success tips you can learn from this, considering these are not a few individuals but the problems a fairly hefty percentage of new businesses face.
So before you start a business, here are some of my business success tips. Take some classes in finance, record keeping, and taxing if you need to, or get online applications to help you manage the details. Understand what the industry standard is for what you are selling, and do not sell too high just because you think it is worth it. Really, understand your industry inside and out. Read articles, books, everything. These will give you business success tips more than anything else.
The top three management mistakes for starting businesses are going into business for the wrong reasons, taking advice from family and friends, and being in the wrong place at the wrong time. Some of these reasons might be sobering, are antithetical to successful business tips, as they are likely things you yourself have dealt with on a daily basis.
Now is the time to evaluate your business plan, and fully take in tips for business success even if they mean toughening your backbone. Are you prepared for the long haul, or just doing this to make a quick buck or relieve boredom? Are you taking advice from experts, or people with little business background? Have you done demographic testing to make sure you are launching the right product, for the right location? These things matter.