10 reasons for failure of business

 
Overview 

Making any business successful is much more difficult than starting it. Every mistake can be a great guide if you want to learn

Every entrepreneur starts a business to reach the peak of success, but most startups fail. By the way, you cannot start any big work with the fear of failure in mind, but keeping in mind the reasons for failure, you can take the right steps. Most startups do not fail for just one reason,but there are some reasons behind it.Today we will talk about the mistakes you can avoid to become successful  entrepreneurs.

1. Lack of good team work 

When there's a conflict between staff executives and management it may cause failure of business plan. The main reason for conflict is when manager do no accept advice comes from staff or may they have only theoretical knowledge and don't understand the practical problems. Such kind of conflict is not good for organizational health. 

2. Deaw back of functioal organization

One of the most important organization principal is that subordinate should receive the command and report only to one boss. If there are more than one boss for the same subordinate, he will confused as to whose order he should obey which is called the unity of command. Because of failure to define the exact nature of the functional authority, the system proves confusing from the point of view of the procedure of control. 

3. Lack of market analysis

 It usually seems that wrong things are happening more in life than right. If you change direction with every shock you get from the market, then you will confuse the team with yourself. If you are in the stage of ideation, then write all the research related to it along with all the available resources. After this, analyze the market for at least one to one and a half years, only then take a decision. The tendency of consumers is always towards attraction towards companies with continuity. In this case, think enough before beginning and then be firm on your decision.

4. Reluctance to delegates

Managers are accountable for the actions of subordinates, and this may make them reluctant to ‘take chances’ and delegate tasks. 

Some managers may simply be too disorganised or inflexible to plan ahead and decide which taskü should be delegated to whom or to set up a control system so that subordinates’ action can be monitored.

 In the short run,this lack of confidence may be justified if subordinates lack knowledge and skill. In the long run, there is nojustification for failing to train subordinates. Managers who lack confidence in their subordinates—perhaps because of an inflated sense of their cwn worth will severely limit their subordinates’ freedom to act.

5.  Bad Product Quality 

Quality of product plays a vital role in success of manufacturing concern. The quality of final product depends on the quality of material used to make it. Besides the latter of affects the cost of production also. Quality involves such considerations as materials, workmanship, grade, size, design, color and pattern. 

Many large companies keep well- equipped laboratories for checking the quality of the materials and goods produced. Quality control of materials helps to cut down the waste of raw materials, labour costs and overheads on account of specified work. 

6. Quantity of products

The temptation to buy large quantities of materials is strong due to such advantage as lower prices, discount, promote delivery, etc. But bulk purchasing is not always possible. Large scale purchase can inflict losses in the form of tying up the capital and losing interest thereon, wastage and deterioration, obsolescence, high cost of insurance and storage, etc.

7. Price 

It is generally believes that materials should be purchased at the lowest price so cost of production is minimised. But quality of materials so purchase may be doubtful. Also the delivery maybe irregular. 

8. Time of delivery

The time element is an important factor in organization. It is essential that all materials arrive in time, so that there is no delay in manufacturing. The dates of delivery therefore, influence the choice of suppliers. If business is active and large order are on hand, it may be advisable to pay even slightly higher prices for timely deliveries. 

9. Evasive attitude with life plan

 It is important to always be clear about your life. As an entrepreneur, if you think that you can make the company faster by reducing your own salary or grooming expenses, it can be a big mistake. If you are able, then spend enough on yourself. Instead of fulfilling a wish now, if you are planning for a day in the future, which is unknown, then it is not a good way to live life. Eventually, it will affect your business as well.

10. Calculating future earnings

It is not right to focus too much on the returns you get at the beginning of any business plan, as circumstances can change your estimates in a single day. Starting a business with valuation in mind is the same as driving a car in front of a horse. Instead of focusing on user volume and return, it would be more beneficial to work on things like operational excellence, client advocacy, user design and cost control.

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