06-19-2018, 12:39 PM
There are lots of reasons why businesses fail. It could be any or a sum of the following:
Lack of experience
Insufficient capital (money)
Poor location
Poor inventory management
Over-investment in fixed assets
Poor credit arrangements
Personal use of business funds
Unexpected growth
Mismanagement of resources and capital usually is the downfall of small businesses. Low sales volume might also be a factor. Nevertheless, when you start your own business, and you start to make money, invest it back into the store and do not spend it on personal expenses. For example, Amazon never declared a profit for the longest time, and they poured all of their revenue back into their business, look where they are now.
Lack of experience
Insufficient capital (money)
Poor location
Poor inventory management
Over-investment in fixed assets
Poor credit arrangements
Personal use of business funds
Unexpected growth
Mismanagement of resources and capital usually is the downfall of small businesses. Low sales volume might also be a factor. Nevertheless, when you start your own business, and you start to make money, invest it back into the store and do not spend it on personal expenses. For example, Amazon never declared a profit for the longest time, and they poured all of their revenue back into their business, look where they are now.