According to Michael E. Gerber (in his book The E-Myth) said that in general, 80% of business / new business went bankrupt and out of business in the first year. Of the remaining 20% were able to survive, 80% of which closed in the first four years.
Practical only 4% of business / new business that can last up to five years. So if there are 100 businesses / new business this year then in the fifth year, it will only remain four business / business only.
This paper is certainly not to make the entrepreneur (business owner) to be afraid. Instead think Michael E. Gerber in the can from the above survey results should serve as a warning that the wheels of business / business does not run and roll away.
There are 10 things that cause the destruction of the business / your business:
1. Investment Decision Errors
Still clearly recorded in our memory, in the 90 business telecommunication (telephones) erupted incredible. Conditions at the time it makes some people think that the telecommunication business is very prospective.
Then they build a business that provides telecommunications services SLJ, DLD, IDD. I hear business is promising up to 40% profit margin at that.
The two kiosks in operation and looks favorable, it was predictable that others will follow the same building businesses. And indeed the era of 90s, has become a business trend, kiosks everywhere, every 100 meters almost certain we will see kiosks.
Then a few years later the business kiosks falling one by one. Telecommunication businesses collapse is partly because such a rapidly evolving communication technologies.
GSM phone that was only to be enjoyed by the economically upscale, artisan vegetable now housing around the complex with gerobakpun using a mobile phone (cellular). Practical business telecommunication age lasted no more than 7 years.
Investment decisions based on the trend have enough big risk if not in Balance with a more in-depth.
What to watch on a related trend is that generally follower is never better than pioneernya.
If not astute in reading and projected market, especially not accompanied with the experience and competence of a capable, the investment you make will be useless and will not bring any results except the stress and regret.
2. Not Having a Good Business Plan
What is needed when you want to build a dream home? Yes, before the development process begins you need to set aside sufficient, suitable land, building plan drawing. So is the business / business. Unfortunately, many micro enterprises, small and medium businesses plan to ignore this and more likely to choose to run the business rely on feeling.
This business plan should start from setting the vision and mission of the business. The vision is to head to the end of the trip. Logically, how do we make the trip if the intent was not there. That's the importance of a vision. From there the business plan described in more detail. Business planning is about what, who, when, and how.
You need to decide what you should get this year, five years or ten years from now. How big is your business will grow five or ten years. How would you run your business so that growth as you want. When you will start running achievement strategies that you have compiled. Who will you involve, and so on.
Measures of business planning is very important.
His philosophy, everything that can not be measured is almost impossible to be improved. And everything that can be measured can always be improved.
3. Not a Good Master Cashflow Management
Many business people have thought that while large capital business must be "safe". Understanding safe here really is not well-founded. Because the business is not just about the availability of financial capital but also how to manage the money they had to be rotated and folded triple or even more.
Huge capital money will be exhausted after a long time as well if not managed properly. Equity or money for a business is like blood for our bodies. If we are deprived of blood, our body will be weak and lethargic.
Listlessness and fatigue. Necessary in order that the business does not wan good financial management skills. For example, how can I make money that can be rotated settles, how depressing the price, how to reduce the accumulated stock in warehouse, when to invest assets, how to make tax planning, shorten the term of the bill, and so on. So that blood continues to flow into each hose lifeline of your business.
4. Not Having a USP (Unique Selling Point)
Competitive world of business has become more intense. Every time new competitors emerge. Generally what happens then is the "price war".
Even China-AFTA program (free trade Asean countries and China) could be predicted by many businesses excitement drown in Indonesia because our country would be in assault by Chinese products that have a comparative advantage in terms of quality and price.
One solution to retain a competitive advantage is to build a USP (Unique Selling Point). USP is not only of the products that are unique but can also service and after sales of its service. But what matters more here is not all that unique value.
All you need is the uniqueness of the value created. USP underlying concept is how to present products or services that have values that are not owned or supplied by competitors or other businesses.
5. Management errors or Dismanagement
Lots of prospective business but ruined because of mismanagement. In this context it is not the business is wrong, but the person who does not have the competence to make tactical decisions and strategic.
Yes, of course, is also concerned about the leadership (leadership). What is less well could be very good if managed by people who have leadership skills that qualified. Many businesses were destroyed because their owners are too slow in making decisions, do not dare to take risks, are less accurate in measuring opportunity, not responsive to change, asleep in the comfort zone, put the employee as an object and not as an asset, it can not make a priority, and so forth.
6. Do not Have No Business Experience or Master of Bussiness Process
Many novice businessman who started his business because seeing others succeed. When acquaintances succeed in the business of computer accessories for instance, he built a computer accessories business also hoping to gain an advantage as it acquaintances.
Though technically he does not know about this business. Outage experience and unwillingness to learn something new, debilitating her business as well.
7. Not Having a Marketing and Sales Strategies of Good
Many businesses both manufacturing and services, which are built without any concept and marketing strategy and sales mature. They only produce goods or services, but forget that the market needs "touches" that moved him to spend his money on a product or service.
One or two sales strategies may be less effective in attracting the attention of the market. Necessary innovation and tactical steps in marketing and sales. Market or consumer standards and norms that continue to rise. Cheap prices and discounts do not guarantee the products / services we would be overrun by the buyer.
8. Ignore Competitors
Businesses often focus on processes and the internal and external developments forget, one of which is a competitor. Fast-growing businesses on the one hand can make the owner over confidence, feel the upper hand. As if the world is already in hand. In conditions such as over-confidence that resulted in the erosion of sensitivity (awareness) in many ways, so stretching competitors unconscious.
Of course, cases like Motorola that used controlled telecommunications technology with analog systems, which then suddenly Nokia "overtaking on bends" to bring digital technology. Instantly Nokia dominate the GSM market. But the competition continues, RIM Blackberry products are capable of removing the dominance of Nokia in particular for upper-middle market segments.
9. Employee Recruiting The Improper
Recruiting and placing employees is seen as a trivial issue. In fact many businesses are confused by this. The trend, employers seeking highly competent employees who would be paid less. It's very reasonable.
But for those who realize he has a high competence, they have many options. So then the employers are usually looking for employees who will be paid less, about the competence was number three. What if the business is run by people who are incompetent?
Besides competencies, staffing is also important. Improper placement resulted in less productive employees. In addition to the competency and placement, are also necessary development (education), communications (meetings, breefing, reporting, etc.) and assessment (performance appraisal).
Change of mind that looks scary. So you should move on and find a way out continuously for the company to get out of trouble.
Eliminate fear always whack at the problem in your business future.