Thursday, November 5, 2015

Start Up Business Success

You probably know that statistics show about half of start up businesses will fail within the first 5 years.  I found this report from the Statistic Brain Research Institute interesting.  Failure rates vary within industry.  The transportation industry has a better success rate than most (55%)  So if you are looking to start a business consider freight brokering.  A sure way to increase the likelihood of your success is to get some training.  Our freight broker training school consistently gets great reviews from our students.  The training is quick (one to two weeks).  And we will be there for you as you get started. 


SearsGoingOutOfBusiness

Startup Business Failure Rate By Industry


Industry Percent Still Operating After 4 Years
Finance Insurance and Real Estate 58 %
Education and Health 56 %
Agriculture 56 %
Services 55 %
Wholesale 54 %
Mining 51 %
Manufacturing 49 %
Construction 47 %
Retail 47 %
Transportation, Communication and Utilities 45 %
Information 37 %
Year Percent Failed
Year 1 25 %
Year 2 36 %
Year 3 44 %
Year 4 50 %
Year 5 55 %
Year 6 60 %
Year 7 63 %
Year 8 66 %
Year 9 69 %
Year 10 71 %
  Major Cause Percentage of Failures Specific Pitfalls
1 Incompetence
46 %
Emotional Pricing
    Living too high for the business
    Nonpayment of taxes
    No knowledge of pricing
    Lack of planning
    No knowledge of financing
    No experience in record-keeping
2 Unbalanced Experience or Lack of Managerial Experience
30 %
Poor credit granting practices
    Expansion too rapid
    Inadequate borrowing practices
3 Lack of Experiences in line of goods or services
11 %
Carry inadequate inventory
    No knowledge of suppliers
    Wasted advertising budget
5 Neglect, fraud, disaster
1 %
 
  Leading Management Mistakes
1 Going into business for the wrong reasons
2 Advice from family and friends
3 Being in the wrong place at the wrong time
4 Entrepreneur gets worn-out and/or underestimated the time requirements
5 Family pressure on time and money commitments
6 Pride
7 Lack of market awareness
8 The entrepreneure falls in love with the product/business
9 Lack of financial responsibility and awareness
10 Lack of a clear focus
11 Too much money
12 Optimistic/Realistic/Pessimistic





























Statistic Verification
Source: Entrepreneur Weekly, Small Business Development Center, Bradley Univ, University of Tennessee Research
Research Date: July 5th, 2015


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