In 1998, the SBA reported that 50% of small businesses fail in the first five years. That wasn’t good news but, sadly, it got worse. By 2008, the mortality of small businesses actually increased by 20% when it was reported that 50% of small businesses were now failing in the first FOUR years.
There are as many reasons why a business fails as there are business failures, but over the years it has become clear that all of those micro-reasons can be conveyed up into a smaller number of macro-reasons, including being under-capitalized, bad management, bad idea, failure to plan, etc.
Recently, on my small business radio program, The Small Business Advocate Show, I talked with someone who knows a lot about why some small business fail and why some succeed. Tim Berry is the founder of Palo Alto Software, the publisher of Business Plan Pro, the #1-rated software for developing a business plan and the author of two great books on business planning, The Plan as You go Business Plan and the business planning bible, Hurdle: The Book of Business Planning. Tim is also one of the founding members of my Brain Trust.
Take a few minutes to listen to our conversation on why businesses fail so you can avoid making these mistakes and land in the survive and succeed category. And, as always, leave your own story and/or comments. Listen Live! Download, Too!