More than 50% of businesses don’t survive more than 5 years. If you closely examine government figures you will see the evidence
The analysts “broad brush” reason for this tragedy is the failures basically ran out of funds. This deliberation is of no value and so I decided to track down those directly and indirectly associated with failed businesses to see if I could uncover the details, establish any recurring reasons for failure and post them on the web 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 going then how are you going to get there?” You must have a clear picture of what you want to achieve and how things will be for your business if you achieve it. To achieve anything you it is essential to have a strategy. Strategy can be likened to a route map it shows you how to get to your destination. It’s a systematic series of activities. Strategy is only effective if it is translated into a business plan which can be used as a benchmark for business performance. A key instrument for monitoring business perfomance is the sales forecast.
Lack of a system for marketing or sales
Marketing is about discovering markets and testing strategies to position your proposition in the minds of prospects and moving them into your sales funnel. 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 use to reach prospects. selling is the process of acquiring leads, forecasting sales and closing sales. In successful companies a good marketing and sales system is often underpinned by a effective sales forecasting software system. Systems like these enable you to track and measure the activity in the sales and marketing processes. These insights arederived from reports created by the software which can then be used to compare what you predicted would happen versus the real outcomes. In summary what gets measured gets improved or discontinued. This is the essential formula for success.
Lack a system to monetise their current customer list
There is a well used phrase that 80 percent of your sales should come from twenty percent of your customers. Your focus is to achieve or exceed this figure. Customers who have previously bought from you are simpler and cheaper to sell to than prospects that haven’t. A combination of decent web based crm software and sales forecasting software should give you the information of recent activity and allow you to uncover opportunities in your current customer base.