| Last week we discussed the importance of | | | | final contributing factor to the death of sixty-three |
| performing an autopsy on a dead business. No, I | | | | percent of the businesses who died from bad |
| haven't been watching too many of those | | | | management was that the owners had no relevant |
| wonderfully graphic, TV forensic investigation shows. | | | | or applicable business experience.Bad financial planning |
| The reason I recommend you do a business autopsy | | | | was the second reason sited by the survey as to |
| is to uncover the exact reasons why the business | | | | why most businesses fail. In business, it's always |
| died. This is valuable information that can not only | | | | about money. According to the U.S. Bank study, |
| heal feelings of personal failure, but also better | | | | eighty-two percent of the business failures studied |
| prepare you for the pitfalls of business should you | | | | reported poor cash flow management as a |
| ever take the plunge again.Starting a business is | | | | contributing factor to the death of the |
| never easy and the odds of your success or failure | | | | business.Seventy-nine percent of the businesses |
| are about even money. The fact is, approximately | | | | were inadequately funded, and seventy-seven |
| half of all small businesses fail within the first four | | | | percent miscalculated the cost of doing business. In |
| years. And a large percentage of those failures occur | | | | other words, they failed to take into account all of |
| within the first year. These are the statistics that | | | | the costs involved when setting the price for their |
| keep many entrepreneurs awake at night. Like | | | | products.Let's move on to my favorite subject: bad |
| Sisyphus, always pushing that boulder to the top of | | | | marketing. You've heard me preach this sermon |
| the hill only to have it tumble back to the bottom | | | | before. You can have the greatest product in the |
| each time, you never know when you're going to | | | | world, but if your marketing efforts are inadequate |
| lose your grip on your business and have it tumble | | | | or ineffective you will end up with a warehouse full |
| back over you.OK, so far in this column I have | | | | of the greatest product that no one in the world has |
| managed to squeeze in references to modern | | | | ever heard of.The study showed that bad marketing |
| American television and ancient Greek mythology. | | | | was a contributing factor in the death of sixty-four |
| Enough highbrow beating around the bush. Perform | | | | percent of the businesses surveyed. Many of these |
| the autopsy and learn from it. Only by knowing the | | | | misguided entrepreneurs either minimized the |
| real reasons your business died can you identify and | | | | importance of marketing and promotion or ignored it |
| hopefully stave off those maladies before they take | | | | totally.A vital part of marketing is knowing who your |
| you down next time, if there is a next time. And if | | | | competition is and always knowing what they are up |
| you're a true entrepreneur there will be a next time, | | | | to. The entrepreneur who ignores his competition is a |
| trust me on this.There are many reasons why | | | | fool (gee, was that too harsh?) and is always |
| businesses fail, but according to a recent survey by | | | | destined to fail, as proven by the fifty-five percent |
| U.S. Bank, the majority of business failures can be | | | | of the dead businesses in the survey who either |
| attributed to three reasons: bad management, bad | | | | didn't even know who their competition was or |
| financial planning, and bad marketing.Bad management | | | | simply chose to ignore the competition |
| comes in many forms. The survey showed that | | | | altogether.Here's a nice hole in the sand for you, |
| seventy-eight percent of the business failures | | | | sir.Please insert your head...Another mistake made by |
| examined were due in part to the lack of a | | | | forty-seven percent of the deceased businesses was |
| well-developed business plan and a business owner | | | | that they relied on just one or two customers for |
| who had no business being in the business he was in. | | | | the bulk of revenues. This is a common mistake |
| In other words, the business owner did not have an | | | | made by many business owners who devote all their |
| adequate knowledge or a thorough understanding of | | | | energy to one huge client. What they don't seem to |
| the business he had chosen to start. This is why | | | | understand is that if that one customer goes away, |
| software entrepreneurs like me don't start shoe | | | | so does most of their revenue.When performing |
| stores. I have feet, I wear shoes. That's not enough | | | | your business autopsy you might identify other |
| to qualify me to go into the shoe business.Next, | | | | contributing factors that were beyond your control, |
| seventy-three percent of the business failures in the | | | | such as a down economy, the lack of qualified |
| survey were also manned by owners with rose | | | | employees, new government regulations that |
| colored calculators. These business owners | | | | negatively affect the way you must do business, the |
| over-estimated revenue projections (the number of | | | | failure of a strategic partner, etc..There will always be |
| expected sales) and under-estimated the burn rate | | | | things you can't control. The key to business success |
| (the amount of money required to sustain the | | | | is to keep control of those things you can and do |
| business per month).It gets better. Seventy percent | | | | everything you can to prepare for those things you |
| of the failed businesses in the study were led by | | | | can't.Next time we'll discuss a few things you should |
| entrepreneurs who were in denial regarding their own | | | | and should not do to help ensure your business |
| competence, or more to the point, their own | | | | success.Here's to your success.Tim KnoxSmall |
| incompetence. These business owners either didn't | | | | Business Q&A is written by veteran entrepreneur |
| recognize or chose to ignore their own | | | | and syndicated columnist, Tim Knox. Tim serves as |
| entrepreneurial shortcomings. These entrepreneurs | | | | the president and CEO of three successful |
| also did not seek assistance from others who might | | | | technology companies and is the founder of |
| have made up for their inadequacies. It's sometimes | | | | DropshipWholesale.net, an online organization |
| hard to ask for help when you are supposed to be | | | | dedicated to the success of online and eBay |
| the one with all the answers.Believe me, I know.The | | | | entrepreneurs. |