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Hello. My name is Rod.
I'm just an ordinary guy that started a few small businesses and ended up making more money than I ever thought possible.
People would ask me how I did it, so I started a blog, offered a free newsletter, and wrote some books. Now, 20 years later I've helped thousands of people to:
Pay Off Debt,
Create Financial Freedom to live the life they dream of, and
Enjoy a Worry-free Retirement.
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13 Reasons Small Businesses Fail Part 2
March 22, 2015
Here are 6 more reasons small businesses fail and things you need to be aware of:
6. Hiring help in desperation can cause big problems. A janitorial startup that I know of brought on his next door neighbor to help him clean a medical clinic. The neighbor offered to have his brother-in-law help with the cleaning. Neither of them knew that the brother-in-law had a drug problem and a medical clinic was the LAST place he needed to work!
7. Refusing to change with the times (to be professional looking) can diminish your chances for success. Maybe you started your business with a used vacuum cleaner that you had at home, and you picked up a few vacuum cleaners at yard sales as you grew your business. Starting on the ‘cheap’ may be a necessity but get some good-looking equipment when you can afford it, have your employees wear name tags, etc. You're a professional company, create the image necessary for others to refer you or provide a testimonial when soliciting new accounts.
8. A fear of getting started is the quickest way to doom your business. Yes, there are steps you need to go through: choosing your name, registering your business or getting a business license, etc.; but you have to start! Whether you're starting a cleaning company, a window cleaning service, a lawn care business, or any other business you choose; you have to be ready to do business. Start your business, get your business cards, knock on doors, and get ready for your first customer.
9. Starting too soon can doom your business also. Read some books about the business you want to start. Start small, grow slowly; as the old saying goes, ‘Don't bite off more than you can chew’.
10. Having no specific customer in mind can defeat your business. Yes, you will find your business may not be the one you started with, i.e. office cleaning may become house cleaning, or turn into a lawn care service; but you need to be pitching your business to a particular type of customer. If it is office cleaning, start by directing your advertising and promotional materials to particular type of clientele; say, businesses within a couple office parks. Whether it is cold calling, sending mailings, or dropping off fliers, work those areas until you get an account.
11. Depending upon the income that you don't have can set you up for failure also. More than once I've seen startup business owners give up full-time employment intending to live off the income from their part-time business. Starting a business part time is wise. Many of the businesses I recommend such as office cleaning, housecleaning, window cleaning or lawn care can be done evenings or weekends. The psychological rush of having that extra income can be deceiving. It's extra income right now. Use it to buy the equipment you need, build up cash reserves, hire some help if necessary. Then when the business is thriving, you can give up your full-time job for the freedom and security that your new business has given you.
12. Spending too much too soon is a sure recipe for business failure. Yes, you're in business now. Hurrah! However, that doesn't mean you need a fleet of fancy vans, luxury office space, and the latest in high-tech equipment. Many startups to do quite well working out of their homes, and I know of several with six-figure incomes who are either still working out of their homes or renting very inexpensive office or warehouse space.
13. Poor management is supposed to be the leading killer of small businesses. It is easy to understand why; you have to wear a lot of ‘hats’ when starting a business. You are in charge of advertising, sales, hiring and training employees, the books, etc. it is hard to do it all well, and sometimes it's hard to do it at all. As soon as you can, relieve yourself of some of the headaches. Make sure your taxes and bookkeeping are handled professionally.
That's a pretty good summary of some of the major problems I've either lived through, or noticed other startups experiencing. Certainly there are more challenges in building a business, but if you can 'master' these, you've a better chance at success!
By-the-way, if anything I've shared has been helpful to you, I'd appreciate you letting others know about the FREE newsletter offer. Thanks!