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The 5 Mistakes Which Cause Businesses to Fail
If you’re like me, then you’ve tried a whole lot of things to make some money. And if you’re unlucky enough to share in my mistakes, then you watched as time and time again everything you tried failed miserably. The good news is the path to success if paved with failures, and you just need to keep trying to get it right. But that doesn’t mean you can make it work if you don’t learn anything along the way. So that’s why I am sharing these mistakes which cause businesses to fail.
1. You’re too focused on what you can get
Greed kills business. It’s like a cancer, and the sad part is most people don’t even realize it. But I want you to think about this for a moment, which business do you want to work with, the one that cuts every corner to save a dime, or the one that is willing to go above and beyond to serve its customers? Yeah that’s right, people don’t like it when they sense greed, it’s an instant deal breaker for most customers. Which means if you want to do things right you have to shift your focus from what you can get, to what you can do.
It doesn’t even matter which industry, construction, fashion, or even a blog, self centered business always comes crumbling down, because in the end money is not nearly as important as you think. Now don’t get me wrong money is important, but making that your only focus is going to scare away a lot of customers, which is not going to get you anywhere close to your goals.
So how do you change your perspective to focus on what you do? Well let’s take a look at some business mottos. In-n-out Burger has stood above a great deal of other chains paying their employees nearly twice what other companies do, and what’s their motto? “Quality you can taste!” See how that had nothing to do with money at all. That’s only an afterthought to them, instead they want to make the best burger, that’s it. Their business model takes care of the rest. Want another example? How about Apple, their motto is “Think different” Once again, their goal is to change people’s lives for the better. How about another? Google’s used to be “Don’t be evil” although they recently changed it to “Do the right thing.” One more, Amazon’s is pretty good too “Work hard. Have fun. Make history.” The point is this, billion dollar companies don’t primarily focus on money, they focus on making a difference, and that’s something people can stand behind.
2. Not giving anything away
Imagine this, you are walking down the street, and you’re a little hungry. You see two taco carts right next to each other. One is giving away free samples, what do you do? If you are like any normal person you are going to take a sample, and if you like it then you will buy some. This is because people by nature are risk averse, meaning they don’t want to try anything new if it involves some cost to them in order to try it. Granted there are a few people out there who seek out new things all the time, but they are a rarity.
If you really want to grab people’s attention you have to give them something for free. Let’s take a look at the most successful businesses in the world for perspective. Google, charges nothing to use their primary service, Facebook is free to the public, the same is true of twitter, instagram, pinterest, they are all free. Now they do have a marketing service which you have to pay for, but it’s not what they really care about. In fact some industries are so focused on trying something before you buy it, that it would be weird if they didn’t let you. I mean, would you ever buy a car if you walked into the dealership and they told you they “don’t allow test drives” I thought not! It would be so awkward you wouldn’t even know what to do, other than leave and never come back.
I’m reminded of this company I used to work for. Our CEO used to give away a free sample of his product to anyone who asked (and a lot of people who didn’t!). But you know what happened, those people tried it, and came back as the most loyal customers I’ve ever seen. It helped that he was making the best product on the market, but no product sells itself. If people hadn’t tried it, they never would have bought it. And believe me when I say they wouldn’t, he was upsetting companies which had loyal customers for decades, just because he was a nice guy who gave away a free quality product.
It doesn’t have to be the most expensive giveaway ever, but you get the idea. You need to give something away for most people to even consider trying your product or service.
3. Your business model makes no sense
This is the counterpoint to the first two, you have to have a business model that makes sense. Everybody knows you can’t sell a product at a loss and keep the doors open for very long. You still need to focus on what you can do for people, but not at the expense of destroying your company. In short just make sure you have all your ducks in a row. If you are in the food business, and you are adding salt to your dishes, then you better know how much you use on average and how much that is costing you. Because all the little things add up, and you don’t want to find that out the hard way.
If you want to understand this a bit better then you should watch this video.
4. You made your business backwards
I’ll put it to you simple, if you can’t make money on the small scale, then you won’t make money on the large scale. I’ve seen too many people say “If I only had the money to start a restaurant.” Well you don’t need a lot of money to sell food, there are street vendors all over the place. Look, if you want to see if your food is something people would buy, then you need to see if they will buy it, not take out a hundred thousand dollar loan to see if they will buy it. Do yourself a favor and get things working before you take the next step.
Also, as a bonus, you will be making money already, which will pave the way to bigger and better establishments. It may seem like chump change, but if you can afford to hire someone to do the work, then you have what it takes to keep growing.
5. You gave up
I admit, when you are trying to get something off the ground it can be hard to get up every single day, and put some elbow grease into it. But the trait which leads to success more than any other in this world is diligence. If you just keep learning and trying, it will work. It’s not going to be easy, it’s probably not going to be very quick, but it will work, if you just don’t give up. You have to make the decision to just keep going, even if it rains, snows, or hails. Remember you climb a mountain one step at a time, and nobody says that’s easy, but it can be darn impressive.
Which of these mistakes have you made?
So there you have it, if you can avoid those 5 mistakes which cause businesses to fail, then you should start to see some real success if you just give it enough effort and time, because that is all it really takes to make it in this world.