It’s no secret that succeeding in the business realm is a major challenge. Statistics actually indicate that only 80 percent of businesses will survive one year, while only two thirds will survive two years.

Nevertheless, what are the main reasons behind these discouraging statistics? What are the primary mistakes entrepreneurs make, which prevent them from attaining growth?

Insufficient Capital

Without a doubt, the lack of monetary resources is a common reason why many start-ups fail. According to the National Association of Small Businesses, the main challenges of being an entrepreneur are: economic uncertainty, health insurance expenses, and a decline in customer spending. 

Success requires investing in new equipment, technology, hiring experts, and one cannot do that without the financial means.

Truth be told, inexperienced entrepreneurs don’t comprehend cash flow and how it works; thus, they underestimate how much money they will need to keep the business running. Concurrently, many individuals have unrealistic expectations concerning the anticipated business revenue.

A U.S. Bank study supports this info, pointing that 82 percent of businesses experience failure due to cash flow issues.

On that note, it is paramount to assess how much money your business will require, over the long term. And, if you’re in need of financing, you shouldn’t dismiss the idea of borrowing money. Getting financing is possible via both traditional banks and online lenders such as Northcash Loans. You can get online loans in the form of personal loans, or installment loans, depending on your specifications.

It makes sense to take out a loan only if your situation requires that. Also, assess if you’ll be able to repay the loan in a timely manner, before signing any documents.

They Lack the Ability to Adapt

Entrepreneurs should acknowledge that the business world is continually changing; and there is nothing we can do to change that. However, what we can do, is think outside the box and try to be ahead of the curve.

The most successful entrepreneurs have no trouble to easily adapt to change, when needed. You should note that change isn’t difficult; it’s the resistance to change that makes change seem like the bad guy.

The key to greatness is adopting an adaptive, flexible leadership, and continually make adjustments in your business models and approach, if necessary.

Poor Management

Numerous business reports mention poor management as one of the leading causes to failure. It makes sense, considering that young, inexperienced entrepreneurs don’t have the relevant management expertise in compelling segments such as financing, selling, production, hiring and managing employees, so on and so forth.

In order to address this problem, business owners should aim at educating themselves in order to gain the skills they lack, or to improve the ones that they already have. Neglecting your business and expecting that it will do fine is also a bad sign. Entrepreneurs should take the time to organize, plan and study the market, its changes, and anticipate the approaches that would best suit the business. Concurrently, a successful entrepreneur will also be a motivational leader who will encourage productivity and create an efficient work environment. Hiring and training competent people is also an important part of the equation, since it is the employees that build the business, and make it what it is.

The Bottom-Line

To sum up, when it comes to business success, it all comes down to the entrepreneur. With ambition, determination, hard work and a positive mindset, challenges can be overcome, as long as one is willing to learn, and embrace self-development. And, most importantly, what distinguishes successful entrepreneurs from the crows is the willingness to learn whatever in order to succeed. 

Published by Arina Smith