Why Some Work at Home Businesses
Fail
Learn from some of the
mistakes others have made.
No one sets out to
fail! Most business owners read all the statistics
(maybe more than once) before they open their
doors. Many know the reasons why businesses fail.
But some businesses operate under this paradigm:
"failure can never happen to me because I
know better." Is that you?
What most business owners
miss is looking at the reasons for business failure
and turning them into action steps to help overcome
the odds of failure. How do I know? I once
thought I knew better, too!
Bear in mind that even "adolescent"
businesses fail. According to the SBA statistics,
90% of small businesses fail within the first
five years. Many businesses aren't producing enough
income because the business owners aren't "business
wise." They may be excellent at a specific
task - consulting, programming, massage therapy,
web site design, copywriting, etc. Or they have
a great product. But wise about the "business"
of business, they are not!
In the past five years of
my business, not one client (including those
who have been in business for more than 10 years)
provided me with a business plan to review. Not
one! Two of 100 clients have had marketing
plans, but marketing plans don't work without
a business plan and other focus type tools, too.
The other common (95%!) mistake I see (and help
my clients correct) is pricing their services
very low as a way to gain market share and new
clients. So low, in fact, that a potential buyer
will perceive the service or product as being
cheap and of low quality, even when the provider
offers years of expertise. NO onE wants to
hire a business that is cheap! Inexpensive - yes;
affordable - yes; cheap - no, no, no!
The most common problems
business owners experience stem from simple functions
like streamlining, organizing, information resourcing,
marketing, planning, visioning, languaging, communication,
technology and ecommerce.
Example: If you know that
most businesses fail because they don't have a
usable business plan, develop your own business
and marketing plans and use them daily; don't
create one that gathers dust on a shelf.
I use the one Page Business Plan Book or
Interactive CD by Jim Horan. It helps business
owners create very realistic, focused, and well
thought-out business and marketing plans, including
scorecards to help you anticipate and avoid business
problems.
Example: Recently, a client
turned down an opportunity to teach computer classes
on a subject she could easily teach. Using
teaching to market her business is on her
marketing plan. So why not? Well, the proposed
classes weren't going to help her get business
for her primary business, they weren't going to
attract her ideal client, and the pay was much
lower than her usual hourly rate. She felt confident
about declining the offer. Of course, that same
week, other new business - the type she really
wanted - came her way!
Example: New client knows
she wants to create a business plan. She also
has a strategy of increasing her income by joining
four organizations with networking opportunities
for her to meet her ideal clients. She joins the
first two groups - total cost: $400. As she starts
her business foundation work, which includes the
one Page Business Plan, she realizes that her
ideal client isn't whom she originally thought
it was! Some clients might be found in the two
groups she's already joined, but not her ideal
clients. As a new business owner, she wants to
spend her time around her ideal clients, first
and foremost. Planning just a little more for
her business would have saved her $400 in membership
fees.
What
other simple things can you do to build a solid
business foundation?
· Use a one-page plan daily to create
your to-do list and monitor your business.
· Create an Ideal Client Profile and Elevator
Speech and define a niche for your business.
· Read one of the "E-myth Revisited"
books by MichaelGerber.
· Go with your strengths. Hire individuals
whose strengths ARE your weaknesses to "fill
in the gaps."
· Remember that there is no need to repeat
the SAME mistakes others have made.
· Know what your business exit strategy
will be.
Most business owners don't
know what they don't know. Get assistance by hiring
non-biased professionals who help you realign
with your vision, create plans and financial scorecards
to monitor your business. Look for someone who
can suggest resources to help you and your business
grow. Someone who's been in your shoes and succeeded.
Start looking at how having a partner - a business
consultant, coach, counselor, strategist, organizer
or planner - can help you grow your business.
Ready
to learn more about business success? Take
a look at the articles I found on business
failure that are posted below, (http://www.coachmaria.com/articles/succeed.html).
Learn to overcome the costly (both in money and
your time) errors that other business owners have
already made. Give your business a fighting chance
to continue to succeed.
© 2004 Maria Marsala, business builder who
helps women-owned service businesses increase
their bottom line in less time. A former Wall
Street trader and manager, she used her business
expertise to create 6 S.I.M.P.L.E. Business Steps,
a program developed to help her clients succeed
in less time. Learn more at http://www.ElevatingYourBusiness.com
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