WJR Business Beat

WJR Business Beat with Jeff Sloan: Why Small Businesses Fail (Episode 271)

On today’s Business Beat, Jeff discusses the top reasons that businesses fail, as found from a study by CB Insights.

Tune in to the Business Beat, below, to learn more about why small businesses fail:

Tune in to News/Talk 760 AM WJR weekday mornings at 7:11 a.m. for the WJR Business Beat. Listeners outside of the Detroit area can listen live HERE.

Are you an entrepreneur with a great story to share? If so, contact us at [email protected] and we’ll feature you on an upcoming segment of the WJR Business Beat!

Good morning, Paul!

Today’s Business Beat is presented by Digital Resource. We know well that a significant percentage of small businesses fail. Look, starting a small business and making it successful is hard. So many bases to cover, so many challenges to overcome, so many critical objectives that must be achieved.

And all of it in a weakest link equation. You can do 99% of everything, right, and still fail. Really? Yep. Why and how can this be? Well, our friends at CB Insights have just released a report listing the top reasons that businesses fail. Let’s take a look.

Let’s start at number three, 20% failed because they were outcompeted. My take on this failure reason: you can’t let this happen. Are you really going to let somebody out-compete you when you’ve got your life, time, energy, and money on the line? This is your small business dream, don’t let someone else get there first.

Number two: 35% of failures occurred because there wasn’t really a market for the product or service offered by the business. Well, now that one has me amazed. You mean a third of business failures occur because people didn’t do their research like focus studies before starting their business to make sure there was a market for what it is they propose to sell? Sounds to me like these entrepreneurs simply deserve to fail.

And the number one reason businesses fail: well, 38% have failed because they ran out of money. Well, look, this is a tough one, but before you launch your business, make sure you do financial projections. Make sure you understand the capital needs of your business and understand when you’re likely to reach, break even, and more important, make sure you understand when you’ll have revenues that will support the business going forward rather than requiring that you or third parties invest or loan money to the business to keep it alive. With proper forecasting, you can put yourself in a much better position to avoid failure due to running out of cash. Our bottom line, do your homework before you start. If you do, your odds of success will go way up.

I’m Jeff Sloan, founder and CEO of StartupNation.com, and that’s today’s Business Beat, today brought to you by Dell technologies on the Great Voice of the Great Lakes, WJR.

Previous Article
WJR Business Beat

WJR Business Beat with Jeff Sloan: State of Business Travel Today (Episode 270)

Next Article
StartupNation Radio

Dell Technologies and Offbeat Native on Starting Small Businesses

Related Posts
Read More

WJR Business Beat: Win $10,000 Grant Through Verizon Program (Episode 410)

On today's Business Beat, Jeff provides details of the Verizon Small Business Digital Ready program, including free resources, coaching and $10,000 grants to get your small business up and running. Tune in below for more details:     Tune in to News/Talk 760 AM WJR weekday mornings at 7:11 a.m. for the WJR Business Beat....
home-based businesses
Read More

The Value of Home-Based Businesses to Economic Recovery

The challenge of America’s economic recovery, in the wake of the COVID-19 pandemic, is to spread it to every community – and especially those that have been historically excluded. The key to meeting that challenge is to appreciate the civic and economic value of an overlooked resource: home-based businesses. There are about 16 million home-based...
Read More

WJR Business Beat: Business Success Means More Than Making Money (Episode 409)

On today's Business Beat, Jeff Sloan talks with Bob Kratt of Hamilton's Propane about how business success can be measured in more ways than just the bottom line. Tune in to today's Business Beat to learn more:   Tune in to News/Talk 760 AM WJR weekday mornings at 7:11 a.m. for the WJR Business Beat....