WHY BUSINESS STARTUPS FAILS IN INDIA
Business startups are the current trends in India. Unfortunately, only 5% of startups sustain more than 5 years. What is the reason behind 95% of startups fails?
Every business has seeded with millions of dreams. No one would like to hold the growth or withdrawn their dream. If so, what really happens in startups which leads to shutoff.
There are many reasons as follows,
- Improper Niche Selection.
- Improper Business Plan.
- Inappropriate Business Management.
- Not Wearing Customers Shoes.
These are the reasons that are taken from many startups which started with a dream and couldn’t complete 5 years.
This is not a negative articulated topic, rather it is to make awareness for founders of startups.
Startups are termed as the company started by a single or two founders. Basically, small businesses with a low volume of revenue generation. The main idealogy of the startups are,
- Be your own boss.
- People to work for them.
- As an extra source of income
- To create passive income
- Bridging the gap of unmet needs in the industry.
Please have a look at, How to start a business for more knowledge before planting startups.
Startups are future multinational companies. The companies which rule the world in current days were a startup while originating.
Startups are the source of job creation. The more number of jobs in a nation, the economical demand will increase. This lead to a economical stability of the country.
So, Business startups are highly required in the current situation in India for more jobs and to figure out the unmet need in every sector.
WHY BUSINESS STARTUPS FAIL:
As we have stated at the starting of this article 5 reasons are highly influencing the failure of the business.
1. IMPROPER NICHE SELECTION:
- Niche is considered to the target of the business audience.
- People who fail always try to take the same footpath of many players already doing. For example, if the hotel business is picking up, everyone plans to start a restaurant.
- This is termed as improper niche selection. Your business should be built on your core strength or interest, rather than seeing the market.
- When you don’t invest your time in selecting your niche. Please stay with the job where you are. and don’t waste your time and money in business.
- If you have identified the niche related to your interest or strength skill. Try to figure out the unmet need of the industry and try to provide a solution. This will be the best business.
2. IMPROPER BUSINESS PLAN:
- Another reason for startups business failure is due to the business plan.
- Once you find the niche, the next work you should do is pre working like,
- Unique Selling Point (USP)
- Competitor Analysis.
- SWOT Analysis.
- Mind Mapping of your business.
- Most failed startups don’t have a clear vision and mission. Without vision, no company can sustain itself in this competitive environment.
- Vision is a kind of road map and benchmark. You can bridge your mind towards the roadmap and check where you are currently.
- So, without a proper business plan, please avoid investing in businesses.
3. INAPPROPRIATE BUSINESS MANAGEMENT:
- To start a business, it doesn’t require to qualify a Master of business administration.
- Few management skills are what needs to run a business successfully.
- Once you start a business, you shouldn’t focus on infrastructure development. You have to invest in your office space or another resource with your profits.
- Even if you have an investor to invest, don’t recuirt employees all of the sudden.
- Try work as an individual or with your co-founder, until you reach a certain income flow into your bank.
- Don’t buy any company materials like desktops, chairs, tables, etc. until you find more profits.
- As a startup company, don’t recuirt employees for more salary which you can’t afford. In case, do those work with
- Part-time employees.
- Another error in business management is financial management. Non-proper usage of financial usage,
- When a company begins its revenue flow, the major mistake founders do is spend on their personal lifestyle.
- You should reinvest in the company and come with a few other new products or services.
- Also, avoid investing in the company infrastructures, and employees at an early stage.
Have a look at an interesting article on What happens to an organization with bad management
4. NOT WEARING CUSTOMER SHOES:
- For business startups, customers are the only reward which you can earn initially.
- Your products and services should be created to satisfy the customer’s needs.
- Don’t create a product which is irrelevant to customer need and try to convenience or push to them.
- Customers are the real funder’s of our business. So, you should do your service which can be an added value to their business or needs.
- So, you have to research all the ways of keeping your customers on hold.
- The most crucial part of customer management is non maintaining accountability.
- When you don’t deliver the product on the estimated delivery date, that that last day of the customer relationship.
- So, always be accountable for your words.
When you avoid these mistakes, your business will be taken care of. Always consider these points before starting your business.
This awareness and planning will keep your business secured and your startups will sustain and will become a multinational company.