Top Reasons Start-Ups Fail

Opening your own business really does take more than patience, hard work, and a bit of entrepreneurialism. It takes much investment and risk to open your own business and be your boss. As the chief executive officer, you are responsible for all business operations. Start - ups require you to see the whole picture at once. Since you have total control, whether you fail or succeed is entirely a product of your efforts. Start-ups also come with perks though and if you ask any CEO of a large corporation, you will find that few executives actually succeeded in the early stages of their start-ups. Read on to find out the top reasons why start ups fail, at least initially.
One of them any reasons why some big executives actually failed when starting their business is because they are accustomed to "empire building skills" which when applied to a smaller scaled business start up, is actually counterproductive. Although establishing a great presence and acquiring grand influence is critical in large corporations, in smaller companies, great attention to detail is a must for survival. You want to make sure the limited amounts of resources you have are up to par. It is all about quality over quality.

Next, start ups tend to fail when companies forget about the importance of your staff and entourage. Your employees lie at the core of your success so make sure everyone on your payroll does their job efficiently and remains happy. Most importantly, employees must be self-reliant and self-motivated. Execs also often forget that in a small company, trust is key and is the glue that holds everything together. Never try to place blame on others, especially those you work with. When mistrust happens, this creates division in your company, not cohesiveness. Then things start to fall apart and your business ends up failing. Keep people working together, not against one another, and especially, not against the boss.

Small companies also need to be pretty selective about the problems they want to attack. This is because there are more financial budgets that need to be considered. Use your resources carefully and conservatively. Now, the model for success for small companies is referred to "dynamic budgeting". Random spurts of events, whether they happen opportunistically, daily, or whenever, can be dealt with on an ongoing business, and not be so strictly based on reports and outlooks.

As head of a small company, if you're not on top of your game every day, be assured, you will most likely fail. There are always new problems that may arise and must be dealt with. Every day gives you a renewed opportunity to make a huge impact on your business, and in turn, profitability. Any managerial and investing decisions you make will have an enormous effect on the well being of your business.

Lastly, start up businesses tend to have a higher rate of failing when they do not have a comprehensive business insurance policy. This leaves great risk in terms of liability and costs when something goes wrong - you get robbed, a customer gets hurt on your premises, etc. Whatever the circumstances, you want to protect your company and get an affordable, but well rounded business insurance plan.</business>