Tuesday, June 12, 2007

Is Failure a Reality?

Statistically speaking 9 out of 10 businesses fail in today’s marketplace, but is it a failure due to lack of clientele or are there other factors involved? Businesses fail because of several factors or a combination of these factors. A business can fail because of lack of preparation and planning. If a person wants to start a restaurant the first thing he/she has to do is find out if there is a large enough client base to sustain the eatery. If the restaurant has a smaller client base than what is needed to run on profit, than its success is based on wishful thinking not on factual data and that is a sure path to failure. A business cannot be successfully run if the owners are constantly taking money out of the principal to spend on pleasure cruises, cars and other frivolous things. Owners should only spend from the money generated from services and only enough to keep the business running smoothly. The company’s principle should only be used for growth and emergencies. So is failure in business a reality? Not when you plan your business on factual data and are disciplined enough to keep costs down.