About 80 percent of businesses make it past year one. After that, in about 5 years, half of remaining businesses are still operating, and in 10 years, about one-third. That means 67% of small businesses will eventually fail.
These numbers can make people afraid to start a business, but you don’t have to have that fear. You can learn how to navigate the failures that come with starting a business, and be prepared for a profitable future.
Why 67% of small businesses fail.
What is it that separates those who succeed from those who fail? There are a variety of factors, but one of the main ones is psychological and financial preparedness. The proper training for financial and management situations will help you be prepared for your small business success.
Improper financial funding from the get-go is a huge reason many businesses struggle and eventually die over time. Starting a small business is no small task, and there is a lot required to make it all go smoothly
Business requires psychological strength.
According to business strategist Tony Robbins, “Business success is 80% psychology and 20% mechanics.”
Tony Robbins goes on to say that most people don’t have the psychological strength needed to run a business. The biggest thing that will hold you back in business is often yourself.
Mental and psychological fitness is needed to help you be prepared for what being a small business owner will mean for you.
You have to have the confidence and determination, or you’ll never succeed no matter how much money you have, how good your idea is, or how much others believe in you.
Permanent failure vs intelligent failure (or, how to fail forward).
Failure doesn’t have to be final. If you’re willing to learn and grow from experiences, then they weren’t really failings at all.
Startups and small businesses are sure to face setbacks, and failures. But it’s your mindset that will truly determine if these problems are permanent failures, or intelligent failures.
Intelligent failures are all about the growth and knowledge you take from failing. It takes strength and character to have a positive outlook on failure, but it’s these determined people who are able to learn from mistakes and use them as they move forward.
How to prepare for long term business success.
Be honest about your passion.
With so many small businesses failing, what options do you have to help your business succeed?
As you start your business, focusing on long-term success rather than immediate success will help you. As you carefully and thoroughly plan for the future, your business will be safeguarded against many of the things that cause businesses to fail.
These five tips will help you be prepared to start a business and navigate the successes and the failures that often accompany it:
Identify and solve a real problem.
The most successful companies are able to identify a real need, and solve it. Whether there is a need for a product, some content, or a service, identifying what consumers actually need will help you create a successful business.
Your understanding of consumer needs may change over time, and that’s good. You can adjust your business model and product as you learn more about your customers.
As you listen to them and concentrate on how you can solve their problem, you will find success.
A degree or courses in business marketing can help you learn how to display your problem-solving company to consumers. It’s one thing to create a company that solves a problem, but it’s another to show consumers that you have the solution they need. WGU can help you learn how to market your company correctly, and demonstrate how you solve problems.
Cultivate grit and lasting resolve.
As a small business owner, there are going to be setbacks, trials, and obstacles. Entrepreneurs need to develop a stiff upper lip so that nothing that comes their way will deter them.
You’ll need to cultivate the grit and resolve to stick with your company even when the times are hard.
Entrepreneurship is hard, but with the determination to stick it out, you’ll be much more likely to succeed and take on any challenges you face.
Surround yourself with great people.
It’s crucial to find good employees and mentors as you start to create your company. You’ll need people that are dedicated to your ideas and company to support you.
You’ll want to learn about taxes and income laws in the state where you open your company so you can get great employees.
You’ll need to plan to pay employees well and give them benefits so they will want to stay around. It can be hard to balance paying employees well and using your budget to progress your company.
The bottom line is that you’ll have to work hard to find, and keep, good people around in your company, but when you do, they are absolutely invaluable.
A degree in human resources can be a valuable asset as you work to identify and hire great people for your company. Human resource degrees can also help you understand how to work with candidates, keep them happy, and build a successful employee base.
Master knowledge and practical skills.
It’s crucial that you continue to learn about your industry and gain the skills you need to progress your business.
Recognize that you can always continue learning, and that there are ever-changing technologies and programs that your business might need. It’s a good idea for you to take time regularly to learn new skills that could be valuable for your company.
WGU offers continuing education that could help you gain those skills and knowledge. With a variety of business degree options, you’re sure to find one that will help you be prepared for starting your own business.
With passion and preparedness, you will succeed.
You don’t have to be one of the statistics. You can beat the odds and be one of the businesses that succeeds in the long term.
Passion and preparation will help you as you prepare to start your business.
If you’re interested in starting a business, you may want to look into getting a business degree first.
A degree from WGU can help you be even more prepared for the ups and downs of a startup by giving you insight and knowledge on the financial, managerial, and technological details you’ll need to know.
Don’t be afraid of starting our own company, but take the leap and get started today.
