Question by  mjh6235 (23)

Why do most businesses fail?

I have been told many times that most businesses fail within the first two years of business.


Answer by  twest (28)

Most businesses fail within the first 2 years because of cash flow. Cash flow is important to be able to pay all of the expenses of a business until the business shows a profit, normally in 2-5 years. Most businesses should have a line of credit to help with that.


Answer by  flamiss22 (5081)

Most business fail because there is not enough capital to start. It takes years to turn a profit and there needs to be enough money to sustain it until then.


Answer by  pjsfb (221)

the biggest problems for most businesses is that they make unrealistic projections for revenue, or do not allow for all the incidental costs. Prepare contingency plans to increase revenue or cut costs before you open to increase your chances for success.


Answer by  neverendingrepairs (21)

Most business commonly fail due to improper planning or lack of detailed research of the market trend prior to opening.

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