We noted in our immediately preceding blog post that a materially high percentage of businesses across the United States cease operations within a handful of years owing to various challenges that company owners either failed to perceive or simply did not adequately prepare for.
And, having noted that, we pointed to a silver lining linked with that reality (excepting for those many failed concerns, of course). We stressed in our August 7 post entry that, “Looking at failure in an instructive way can yield sharp insights and learned lessons for new business players.”
Indeed, there is much to glean from third-party failures for newly emerging entrepreneurs and start-ups with fresh dreams and ideas. A primer on “what not to do” is arguably every bit as important as a “key steps to take” directive for profit-minded business principals and owners.
The publication Business Insider presents for readers’ consideration culled statistics that prominently highlight several sources of common company failures.
Leading the pack are cash-related issues (a lack of incoming money from receivables; inaccessible or dried-up funding sources and so forth), which, in turn, often accelerate and exacerbate other problems.
Inappropriate “product/market fit” is also referenced, as are company deficiencies relative to competitors, an improper entity selection (e.g., corporate form rather than a partnership) and a management team/structure that has glaring weaknesses.
Looking at such things can be invaluable for start-up principals, who can duly consider them and take proactive steps to avoid failures that doomed other enterprises.
An experienced team of attorneys at a proven law firm can help with that across every important facet of business activity, given the centrality that legal representation commands in matters ranging from company formation and financing to regulatory compliance and a host of other considerations.