It is common knowledge that many small businesses fail within a year. However, many also succeed. Why do some thrive while others don’t manage to survive? There are several common myths about small business success. Each one of these myths is true for some businesses while being completely false for others.
If a New Small Business Fails Within a Year, the Area Just Isn’t Ready for It.
Sometimes, an area simply can’t support a business. Other times, the business owner quits to soon, doesn’t advertise effectively, or has a bad location. It is wise to really research the economic status of an area before opening a similar business, but taking a close look at why the other business failed is also a smart idea.
A Business Failed Because It Was Located in a Home.
Multimillion dollar computer corporations began as home businesses. Unless the entrepreneur is running a business where appearances are everything, a business run from a professional looking home office is just fine.
The Small Business Owner Who Doesn’t Succeed With a First Business Isn’t Cut Out for Entrepreneurship.
Actually, the opposite is usually true. A person who has a failed business under his or her belt knows from personal experience what the pitfalls of the last business were and can avoid most of them with a new business. However, if the first business failed because he or she just couldn’t remain organized, forgot to invoice customers and spent all day playing Solitaire instead of hunting for new contacts, then a second try at starting a business is probably a very bad idea.
A Move to a New Location Can Kill a Business.
It happens quite often. A thriving new business moves to a new location and fails within a year. However, other times the business doubles its revenue. Before moving a new business, think very carefully about customer travel patterns. Instead of driving as little as five minutes out of their way to continue going to the business that has moved, they may opt to find a different business that is located within their current travel pattern.
The Business Failed Because the Owners Weren’t Committed to It.
This can be true, but it also can be completely false. If the owners shut down the store on a whim because it is a nice day, a cold day, the third day of a week with Friday the 13th in it, National Pickle Day, and for any other random reason, it is probably very true. Small business owners know that the second they decide to close for the day, someone will come wandering in the front door. Despite the fact that they have somewhere to go, successful owners usually give the potential customer a warm welcome. This is because they are aware that the potential customer isn’t likely to come back another day after being shooed out like a pesky fly. The same is true for people who walk up to the store, tug on the front door and then see the “Sorry, we’ve gone fishing!” sign in the window. One unscheduled closure is usually forgiven, but two or three cause them to decide to head for a store they know will be open.