The Bureau of Labor Statistics found that 50% of small businesses fail within the first five years. These statistics seem bleak, especially to entrepreneurs and small business owners. However, by understanding what makes businesses fail, you will be more equipped to succeed and grow value in your business.
Fail To Understand Your Audience
Businesses that fail to understand their target audience are more likely to fail. Studies show 14% of businesses failed because they ignored their customers. Customer Capital is one of the Four Intangible Capitals in every business. The stronger your Customer Capital the higher your company’s value. Forming deep connections with your customers, understanding their individual needs, and developing a loyal customer base help strengthen Customer Capital.
17% of businesses fail because they have a poor product offering and 42% fail due to a lack of need for their products or services. By understanding your audience, meeting and exceeding their needs, you will increase your company’s success rate.
Fail To Learn From Industry Experts
As a business owner, you may be an expert in your industry. But more likely than not, you have plenty to learn from those with more experience and training than you possess. According to Fundera, 23% of businesses failed because they did not have the correct team in place to run the business. Additionally, 19% failed because they were outcompeted by another company. By accepting guidance from industry leaders, business owners will gain a more well-rounded wealth of knowledge to run their companies successfully.
Enhance your business knowledge and build your personal library of industry-leading books from top business professionals. Through our Exit Planning Library package in the Exit Planning Institute Season of Deals, you’ll receive eleven books for $150! The books in this package discuss everything from maximizing business value to sharing successful business stories. This package is valued at over $350!
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Fail To Gain New Knowledge
People, in general, are constantly learning. But as a business owner, it is imperative to continue to grow your professional knowledge. Without investing in your professional development and improving your education on business topics, your business will not be able to grow to its full potential.
Business owners gain foundational knowledge in exit planning through the Certified Exit Planning Advisor (CEPA) credentialing program. The program allows them to develop an understanding of the risks in their business, learn how to improve their intangible capitals, and ultimately will build value in their organizations.
Request the CEPA program overview to learn more about the course.
Learn More About CEPA
Roughly 14% of businesses fail because they have poor marketing strategies. While marketing is not a strong suit for all business owners, by educating themselves on marketing basics, owners can see large growth in their sales and customer relationships. The EPI Marketing for the Professional Advisor Masterclass is a five-part, on-demand, interactive masterclass which arms owners with clear techniques and strategic implementations to improve marketing and sales performance.
Request the Marketing for the Professional Advisor Masterclass Checklist to see where your business could improve its marketing.
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For business owners to truly create significant companies and decrease their likelihood of failure, they must be open to education, seek out expert mentors, and continually build value in their business.
