Fewer than 50% of businesses survive beyond five years. Check government statistics if you don’t believe me
The official propose the reason for failure is the unfortunate ones just ran out of cash. This explanation is not very useful and so I decided to find those directly and indirectly involved in failed businesses to see if I could uncover the details, establish any recurring reasons for failure and publish them on the blogosphere in the hope that my findings would help others avoid a similar fate. I discovered eight consistent reasons for business death. Here are three of them:
No Vision, mission or strategy
“If you don’t know where you are headed then how are you going to get there?” You must have a clear illustration of what you want to achieve and how the future will be for your business if you achieve it. To achieve anything you it is essential to have a strategy. Strategy is like a road map it shows you how to get to where you want to go. It’s a structured series of actions. To make a strategy work you have to create a business plan that not only contains the key actions and milestones but can used to measure business performance against. A key instrument for tracking and measuring business perfomance is the sales forecast.
Lack of a system for marketing or sales
Marketing is about discovering markets and trying out strategies to position your proposition in the minds of prospects and pulling them into your sales pipeline. Sales is about engaging the prospect and getting them to buy your product or service. Marketing is a process of measuring and refinement of the methods you employ to engage prospects. selling is the process of acquiring leads, forecasting sales and closing business. In effectively managed businesses a decent marketing and sales system is often underpinned by a effective sales forecasting software system. The tools in these systems help you to track and measure what is happening in the sales and marketing processes. Results arederived from reports created by the system which can then be used to compare planned vs actual results. The bottom line is what gets measured gets improved or discontinued. This is the essential formula for success.
Lack a system to monetise their current customer base
There is a well used rule that eighty percent of your sales should come from 20% of your customers. Your job is to achieve or surpass this number. Customers that have already bought from you are easier and cheaper to persuade to buy from you than prospects that have not. A combination of good web based crm software and sales forecasting software will give you the information of historical activity and enable you to discover opportunities in your current customer lists.
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