You know who I am talking about. Perhaps, if it is NOT you, you do know of several folks this happened to (or is in the process of happening to) Perhaps it IS you - or perhaps you are one of the other 50% with a succeeding business. If so, please accept my congratulations.
When the economy was strong, it was possible to be mediocre and have a thriving business. Also when the economy was strong and a small business failed, it meant that the entrepreneur went and got a "real job" back in mainstream society. It was sort of accepted and understood. Now, for some entrepreneurs who originally became downsized, and their business is not taking off - it is an extremely tough place to be in.
However, it is not rocket science to understand why so many small businesses fail. The Small Business Administration still, on their current website, offers a statistic of 50% of all small businesses failing within 5 years.
Here's why SOMEONE you know has a business that is failing or has failed:
1. They skipped the basics - like the business plan - along with the "why" you are doing it and the "how" all worked out.
2. They do not have a compelling value proposition - in other words, people don't have reason to buy what they offer, EVEN if they think it is awesome. That makes it not-awesome. How can we tell? People are not buying from them. Those that do, don't come back.
3. They (or their management team?) made working with their company too difficult - too many options, hoops to jump, varied hours, or other inconsistencies. People shouldn't have to study to do business with you - it should be easy and flow.
4. They did not follow up on the precious qualified prospects that they did find (assuming they knew how to qualify) - OR even worse - they didn't follow up with actual customers who had a good experience with them but haven't bought again due to indifference. I know you know someone like this, right?
5. They did not have processes and methodologies in place for marketing and sales. It is not hard, but it critically needs to be done. What recurring revenues do they have on the first of the month - whether they are in that day, or out ill? What products and markets are growing to be able to grow revenues? Have they even talked to a business growth coach or sales strategist?
Oh, there are a few other reasons - like their brand got fractured and so there was not a throng of strategic partners out there recommending them - because, well - people don't really know for sure what they do - and the public doesn't hear ongoing stories about great new customer experiences. They may have just been grumpy to customers (like one of the vendors WE deal with - we laugh each month and wonder when they will be replaced with someone who actually cares about us).
Bottom line: there are many resources for their success. Are they reaching out? Give your favorite small business owner a gift this year of a business building tool or professional services they can use. For our part, we are offering a 30 minute, unique and guaranteed "Revenue Brainstorm" session for a very special rate of just $39 (instead of $120) - how's that for the perfect gift to help boost revenues? If they are interested, let us know -we have just 10 slots through December to help you out.