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Failure Is Not An Option

Guest post by: Karlene Sinclair-Robinson

Article Overview: Many individuals are starting their first venture into the entrepreneurial world for the first time. Some have been at it for some time. Whether you just got started or have been around the block, you will be faced with similar issues from time to time. Realizing that startups have a high rate of business closures, especially in the first year, it is important to know the trigger points.

Failure Is Not An Option

In today's business climate, if you are not as savvy or in the know, you might as well call it quits. For your business to succeed, you must know all the key areas of your business inside out. If you don't know those areas, then you must have staff that is qualified to do the work and more.

SBA statistics show that over 90% of start-up businesses fail in the first year. Why is this so? This happens for a number of reasons. Let's look at a short list:

• Business Owner's experience
• Financial situation
• External Factors
• Internal Factors

The short list above can be broken down based on the individual business owner. Looking at the list brings to mind that there might not be enough capital to operate the business prior to profit being made, that is, after gross income minus all expenses, taxes, and other financial obligations. It also brings to mind the fact that the business owner might not have prepared for the external and internal factors that can affect a business from staffing, timing, obligations, mandatory requirements, and more.

Assessing your business model, business plan, marketing plan, human resources (internal and external), and your personal and business financial position is extremely important. You need to ascertain whether you are in the right industry for your skill set, or if you need to improve your job force. This is where a personal skills assessment would certainly come in handy. This would include your skills, strengths, weaknesses, and much more. It would help you figure out whether you are in the right business or if you should be doing something else.

Access to capital is another major contributor to start-up businesses failing so quickly. You must determine if startup capital resources are a positive or negative factor. Knowing how you will gain access to capital through a variety of methods is important. This will assist you to in stay in business longer.

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Article Tags: business closures, business owner, first venture, small business, startups



Related Forum Posts
Why A Project Fails? - Hello Everyone As the size and complexity of ones business grows, so does their need to effectively manage projects. I have been thinking about the major reasons why a project can go wrong and my limited experience comes up with the following. 1 Leadership: A project manager with leadership skills and not just management skills. 2 Failure to (Foresee and) Plan 3 Failure to Manage: Ineffective change management control methods. Unclear decision making guidelines. 4 Talent: Finding, allocating and developing people 5 Scope: Setting an overly ambitious or amibigious project scope 6 Alignment: When projects are not prioritized in alignment with the business strategy, or project members personal objectives are not in tandem with that of the project / company 7 Lack of Candor: Communication Breakdowns I would be interested in knowing everyone's thoughts on this, especially on ways to overcome the above mentioned obstacles. Cheers!
Top performing Franchise Loans - Evan, There are over 120 Franchises listed by the SBA with 0% Loan Failure from 10-1-00 to 9-30-05 these companies have at leat 10 loans disbursed. A number of the companies are Hotel/Motel Franchises so I listed them separately. Since all the ones listed have 0% loan failure I listed them descending by # of loans disbursed. Top 20 (by # loans Disbursed) 0% SBA Loan Failure (does not include hotels/motels) 1 21425--CULVER'S FROZEN CUSTARD 85 2 66910--PRIMROSE SCHOOL (DAYCARE) 76 3 14467--CARTRIDGE WORLD STORES 54 4 68021--QUIZNO'S SUBS 41 5 06560--AUNTIE ANN'S (SOFT PRETZELS) 40 6 29912--FIREHOUSE SUBS 35 7 31154--FOOT SOLUTIONS 35 8 52707--MEDICAP PHARMACY 35 9 09802--BEN & JERRY'S ICE CREAM 33 10 67759--COMFORT SUITES 33 11 70150--RITTER'S FROZEN CUSTARD 32 12 05650--ARBY'S 31 13 65160--PLATO'S CLOSET 31 14 67417--PUMP IT UP 30 15 69149--REMAX 30 16 71456--SALAD WORKS, INC. 30 17 76282--SONIC DRIVE-IN 27 18 84725--UNION 76 OIL 27 19 17049--CHRISTIAN BROTHERS AUTOMOTIVE 26 20 78950--SUNOCO SERVICE STATION 26 Top 10 0% SBA Loan Failure Hotel/Motels 1 10275--BEST WESTERN INN 104 2 67750--COMFORT INN 98 3 38605--HOLIDAY INN EXPRESS 87 4 36680--HAMPTON INNS 57 5 53165--MICROTEL 33 6 75385--SLEEP INN MOTEL 26 7 04160--AMERIHOST INN 18 8 69134--RED ROOF INN 13 9 17230--CLARION INN & SUITES 11 10 20715--COUNTRY INN 11
These maybe the coldest franchises out there: - Here are the worst 15 performing franchises in regards to having the highest Small Business Administration (SBA) loan failure rates. The list is dotted with sub sandwich shops, fitness centers and car shops. WORST FRANCHISE LOAN FAILURES Failure % 1 OBEE'S SOUP SALAD SUBS 55.56% 2 LADY OF AMERICA 41.94% 3 COUNTRY CLUTTER (BED & BREAKFAST) 41.18% 4 COPY CLUB 36.36% 5 ALL TUNE AND LUBE 35.71% 6 PICKERMAN'S 35.71% 7 PHILLY CONNECTION 35.59% 8 ROLY POLY ROLLED SANDWICHES 34.78% 9 COTTMAN TRANSMISSION 34.48% 10 HAIR COLOR EXPRESS 33.33% 11 LEE MYLES AUTOMOTIVE TRANSMISSIONS 33.33% 12 GODFATHER'S PIZZA 33.33% 13 SMOOTHIE FACTORY 33.33% 14 BLIMPIE 31.39% 15 GOLF U.S.A. (RETAIL GOLF EQUIP.) 30.77% Source: Small Business Administration, SBA Loan Performance Within Franchise Code for the Period of FY 2001 - 2005


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