Why businesses fail, your ideas

Guest · Posted: Sun Oct 09, 2005 3:07 am Post subject: Why businesses fail, your ideas

In reading the book "The E-Myth" by Michael Gerber and thinking about
this problem of why businneses fail, I have come up with the following
top 3 reasons list:

1) Business owner's do what they want, not what the customer wants.
2) Owners do not have ambitious plans. They do not want to grow and
change
3) Money is seen as a solution to all problems, rather than logical
ideas.

What are your thoughts?

Scott T. Jensen · Guest

I think most businesses fail because...

1) The owner STUPIDLY thinks that if they start a business, they'll be their
own boss. They hate their current boss and think opening a business will
allow them never to have a boss again. Wrong. It is true that business
owners don't have "a" boss. The reality is that they have numerous bosses.
Every single customer is their boss. And if they lip off to one of them,
they lose that customer and their business suffers.

2) Entrepreneurs thinks one can best run a business by flying by the seats
of their pants. Wrong. The most successful businesses analyze every single
aspect of their business and ask how can we do it better, cheaper, and
faster. It is the reason why 90% of business fail that spend less than six
months on their business plan and why 90% of businesses succeed that do. If
that isn't stark fact I don't know what is.

3) They think they know all the answers and don't think they can learn from
their competitors. I always told my clients that spending one day a week
analyzing your competitors will do more for your business than all the
business meetings in the world. And I'm not talking about cloak-n-dagger
analysis. I'm talking about going and talk to people doing what you're
doing but outside of your sales territory so they don't view you as a
competitor.

There are other reasons why businesses fail, but the above three are my top
three.

Scott Jensen
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John A. Weeks III · Guest

In article <11kgk9biu5r6m06@news.supernews.com>,
el_roachmeister@yahoo.com wrote:

Quote: In reading the book "The E-Myth" by Michael Gerber and thinking about
this problem of why businneses fail, I have come up with the following
top 3 reasons list:

1) Business owner's do what they want, not what the customer wants.
2) Owners do not have ambitious plans. They do not want to grow and
change
3) Money is seen as a solution to all problems, rather than logical
ideas.

What are your thoughts?

I don't see a problem with #2. Often times, in the process of
growing, you end up making less money (at least for a while)
than in your less risky one person mode of operation. For some,
there isn't the desire to take a risk and invest only to see
less, at least in the shorter term.

#1 and #3 are lack of experience. That is the true business killer.

-john-

--
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John A. Weeks III 952-432-2708 john@johnweeks.com
Newave Communications http://www.johnweeks.com
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Nospam · Guest

On 10/8/2005 6:07 PM, el_roachmeister@yahoo.com wrote:
Quote: In reading the book "The E-Myth" by Michael Gerber and thinking about
this problem of why businneses fail, I have come up with the following
top 3 reasons list:

1) Business owner's do what they want, not what the customer wants.
2) Owners do not have ambitious plans. They do not want to grow and
change
3) Money is seen as a solution to all problems, rather than logical
ideas.

What are your thoughts?

No well defined business plan. No budget.

Guest · Guest

Nospam wrote:
Quote:
No well defined business plan. No budget.

I have never really understood what constitutes a good business plan?
Your business will grow depending on the customers , not on what your
plan says. Why have any plan other than "My plan is to grow, and to do
whatever it takes to achieve that?" Why would someone have a plan to be
the best widget maker in 5 years? In five years that widget may be
obsolete!

Nospam · Guest

On 10/14/2005 1:06 AM, el_roachmeister@yahoo.com wrote:
Quote: Nospam wrote:
No well defined business plan. No budget.

I have never really understood what constitutes a good business plan?
Your business will grow depending on the customers , not on what your
plan says. Why have any plan other than "My plan is to grow, and to do
whatever it takes to achieve that?" Why would someone have a plan to be
the best widget maker in 5 years? In five years that widget may be
obsolete!

And how do you define the customers or do you just wildly go after any
customer? That's in the plan along with things like how to market,
start-up costs, overhead costs, projected revenue, etc. Get a book on this.

Also, if you want to raise cash either from a bank or investors, you
better have a good business plan.

Dan

Guest · Guest

Nospam wrote:
Quote: And how do you define the customers or do you just wildly go after any
customer? That's in the plan along with things like how to market,
start-up costs, overhead costs, projected revenue, etc. Get a book on this.

Actually that is a good idea, to go after any customer. Business
should follow darwins natural selection, i.e create a large
population of 'widgets' and only let the strongest selling widgets
progress. Mutate the widgets now and then , but let weak widgets die
off.

If you restrict your business to only one type of customer then you
are basically only offering 1 widget. This one widget may be ok
today, but could easily be obsolete in a few years. Without the
experience of developing many widgets your business will likely fail
in a few years.

Quote: Also, if you want to raise cash either from a bank or investors, you
better have a good business plan.

I think it is a mistake to thing raising cash will help your
business. Business needs ideas more than cash to grow. these ideas
will come from your population of widgets and customers. I see your
point that bank will require some plan, so just show them the fittest
populations you have been able to breed.