The 2 Real Reasons American Businesses Don’t Last

The opportunity and ability to easily launch your own venture is one of the best things about this country and one of the reasons it continues to be the number one choice of people worldwide who are looking to relocate. However, the high rate of small business failures in the US is no secret. Why is this and how can you avoid becoming one of the negative statistics?

You have probably already read many business advice columns pointing out poor budgeting and planning as well as lack or research and poor marketing being responsible for businesses failing. However, clearly there has to be more to it than this. The last couple of years may have seen more small business failures than normal due to macroeconomic issues, though at the same time there are record numbers of new businesses being launched thanks to new cloud computing solutions, outsourcing and the effectiveness and affordability of Internet marketing.

There are 2 reasons that US businesses don’t last that are intertwined but aren’t addressed often enough. The first is that most businesses are simply born out of greed or a need for money. For those of you with the puzzled look on your faces, yes, the main purpose of most businesses is to make money or at least a good living for the owners but this unfortunately often leads otherwise intelligent and caring individuals to opening businesses they have no business opening or at least running them poorly. So many people, even experienced entrepreneurs fall into the trap of opening businesses to cash in on the latest fad whether it is a certain type of cuisine, a new way to make money from real estate or the latest workout craze. This presents two issues. Firstly in the heat of the moment and with cash flying in the door these business owners often forget how fickle people are. The same reason that product or service is so hot today is the same reason it will be abandoned tomorrow. Do you have a plan for that? Then, even if success seems to last a while or when things get challenging business owners get bored or tired of the business because they didn’t have a deep passion for it in the first place, only the green bills that were flowing in the door. Much wiser and more enjoyable to choose to follow something you really love and that will last instead of starting over again every five years, no?

The other side of this coin and the second reason many small businesses fail is quite the opposite. Many decide to invest in or start businesses purely because it involves doing something they have always loved or have always dreamed of. It could be opening a bar on the beach, becoming a chef and running your own restaurant, managing a bed and breakfast or becoming a personal trainer. Unfortunately a good portion of this crowd hasn’t given enough thought to the numbers or hasn’t really considered the big picture. Money may not be the main factor right now but unless you plan right from the start your dream business could easily become a financial nightmare and source of pain. For the examples above, these small business owner will likely find out one day that they can’t reach their ultimate goals while working in their businesses on a daily basis. They have just created another job for themselves. Often one that pays a lot less per hour than they were making before. You must follow your dreams but by consulting a professional business coach during the planning stage you can ensure that you will not only build a business which works but one that will last and allow you to realize them.

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