Success in business seems to be a very well-kept secret, at least to most people. Why else would 80% of all new business startups fail in the first three to five years? Recently I was working on our soon-to-be-published anthology “Real Hope for the Unemployed.” In the final chapter I was making the point that the only real hope for America’s unemployment problem is business ownership.
That is when I discovered the failure rate for business startups has remained virtually unchanged over the past twenty-five years. My immediate question was why. First: Why do businesses fail? And second: Why has this rate remained the same for a quarter of a century?
To answer the first question I found a report by Bradley University of Tennessee Research that said 25% of new businesses fail in the first year and that the top reasons were all largely due to the incompetence of the owner. Things like – emotional pricing, living too high for the business, nonpayment of taxes, no knowledge of pricing, lack of planning and the list went on to name thirteen areas where the business owner’s lack of knowledge or experience killed their chance to be successful.
The answer to the second question is more problematic. I believe that we are faced with a self-fulfilling prophecy as Robert K. Merton explained it: “The self-fulfilling prophecy is, in the beginning, a false definition of the situation evoking a new behavior which makes the originally false conception come true…” Our self-fulfilling prophecy that 80% of all businesses will fail within 5 years, has become conventional wisdom and we don’t even try to address the issue.
What would happen if we could somehow turn that around? If we could help 10% of all the business that will fail this year not fail, what would that mean? Do you realize that would mean at least 50,000 businesses don’t close their doors. How many employees would that help? We can’t tell. But is 50% of all the new jobs created each month are created by small businesses it would seem that every small business is worth saving.
My observations lead me to believe that the root of the problem causing the high failure rate in business startups is that too many entrepreneurs think they know it all and as a result don’t ask for help even when they know things going into the tank. What if you could see the error of your ways in the operation of your business and get the help you need before it was too late? I am convinced based on more than on forty years business that the issue is not IQ. You don’t have to be a genius to run a successful business we are all smart enough to do that job. What most of us need is just a little help.
Why don’t you take a moment right now to take a step in the right direction? Our next anthology is “Real Hope for Business Success”. In this soon to be published book I will be joined by nineteen other experts in the field of business startup and management. They will be giving you the real secrets to success which can help you launch a business or turn your business around.
Click Here to send a request for notification. I will let you know when the book is available for purchase.