If you’re about to launch a startup, you’re sure to be excited by the idea. You’ll have lots of different ideas, and you’ll be keen to get going as soon as you can. But it’s important to know that an estimated 97 percent of startups will fail. This shouldn’t put you off from launching your business, but it’s crucial that you are prepared and understand what it is you’re letting yourself in for if you want to be in the three percent of startups that make it. Here are some of the biggest reasons why startups fail so you can avoid being in this situation and grow your business to success.
You might have the most amazing idea, and that idea could be something that will revolutionize the world. So of course, you’re going to want to let people know about it and start selling right away.
This is not a good strategy. As much as you might be sure you have a market and that your goods are high quality, that doesn’t mean you’re ready to launch, and if you go too soon – before you’re really ready – you will lose that initial rush of interest. Once this is gone, no matter how many changes you make and what you do to improve, your potential customer will no longer be interested.
It’s far better to take some extra time putting every detail in place, from revenue cycle management software for healthcare organizations to thoroughly testing your products to having good branding to having a team that has enough training and so on, than it is to rush to launch and not be able to handle the work that comes in.
For a business to be successful, there has to be a high enough level of demand for whatever it’s selling. As an entrepreneur, you’ll love your idea, and you may well believe that everyone else will love it too, but launching a business on that belief alone isn’t enough, and you might discover that you were wrong – not enough people want to buy what you’re selling.
The best way to prevent this is to conduct market research. Find out just who will want your product (this will help when it comes to marketing also) and what proportion of the population they make up. Is that going to bring you enough business? You have to be honest with the results, and if there isn’t enough demand, you’ll need to start thinking again. It’s annoying, but it’s far better than launching and then having to close, losing money in the process.
Some competition in business is good. It’s always helpful to have a few competitors to learn from and work with. However, too much competition could be just that; too much. You need your business to stand out from the crowd, and unless you have something unique to sell, that’s going to be hard, even impossible, if there is a lot of competition already.
Again, market research will give you an idea of just how much competition there is for your products and services. If there is a lot, perhaps you can think of adding a twist to your idea to make it different; this will help immensely.