Running a start-up business can be difficult, particularly in the early stages when you have little experience and are burdened with the responsibility of establishing a company.
According to statistics, around 20% of startups fail in the 1st year, more than 50% of them fail within the next 5 years. Further, given the pandemic, it is even more difficult for small businesses to survive and thrive. It’s tough to understand what is and isn’t the right thing to do
Here Are The 7 Reasons Why Startups Fail, That Will Make You Think Twice:
Lack of Consumer Demand
- Most businesses feel that their products and services are appealing and that there will be high demand. However, if the product fails to generate demand the business would suffer a setback.
- In order to operate easily, start-ups need sufficient time and money. Because of insufficient funds, many start-ups fail. Many enterprises are unable to raise additional funding.
- Poor Management is another main reason why startups fail. To take a start-up to the next stage, you’ll need to strike a balance between making priority and non-priority decisions.
- Bad hiring practices, inefficient organizational structure, lack of quality leadership, and inadequate communication are all examples of poor management.
- A business can fail due to the negligence of the management team.
- The product’s price plays a great role in a start-up’s success.
- If a product is priced too high, it will not be able to attract enough consumers. If the product is priced too low, then it would take a long time for your business to recover costs and break even. This in turn would affect profitability.
- When you start a business, you should determine your target audience. Your business should focus on attracting the attention of customers and converting them into leads through social media and other channels.
- If your company fails to successfully market the product, the company may not grow and achieve its desired target.
- It is very important for a start-up to come up with products and solutions that customers need. The problem arises when the team ignores the needs of customers.
- If you do not receive and accept feedback from users from time to time it will negatively impact your business.
- A start-up can get tied up in legal difficulties, which can lead to failure. It could be anything from the suspension of a high-profit associate account to the failure to expand your business.
Many entrepreneurs believe that creating a product, service, or website and acquiring customers is easy. It is, however, difficult to accomplish without a successful business model.
A diverse team with a variety of skill sets is crucial to a company’s success.
Further, given the world of social media, every company needs a professional website and social media presence to help the business achieve its true potential!
Related Read: 5 easy steps to start your own E-commerce business!
How Can We Help You?
At Startupgowhere, we can help you run a successful business. You can focus on running your business, while we look after the compliances.
Our scope of services include:
- Registration of your startup company/LLP.
- Maintaining proper books of accounts, to help manage your funds.
- Tax filing and compliances.
- Legal services and other related compliances.
To incorporate your startup today and help us achieve your business dreams!