Serially, entrepreneurs are optimists. No, they don’t like to think about failure. In fact, for anyone around them who believes in the law of attraction or the effectiveness of positive thinking, they can even make them feel as though thinking about failure causes it to come by.

But the truth remains the same. It’s not just about positive thinking but importantly about positive action. In reality, knowing what action to take means studying success as well as studying failure. For instance, if you want to avoid the fate of high-profile failed businesses, wouldn’t you rather try to understand the mistakes they made so you don’t walk on their footprints?

That’s the spirit!

Please find below top 3 reasons businesses fail, along with some advisory to help you NOT repeat same mistakes:

Lack of consumer intelligence

To solve a market need, you need consumer insights before, during, after and every step of the way. Enough of plunging into the market just because you assumed that there is a market for what you’re offering. “Everyone” is not a market. It’s impossible to sell to everyone, at least at the beginning. It is consumer intelligence that would inform you about the idea of “product-market fit.” Your idea has to solve a market need—one that your target market is willing to pay you to solve. And the only way to confirm their willingness is through consumer research even if it’s a just a dipstick.  Looking for where to get these data? Not far to fetch! Did you know this portal you’re on right now is even more than enough to guide you? Therefore, always return to CONSUMERTRICS if only to read posts and insights crafted just to help you whether you are consumer or a brand.

Couldn’t identify the consumer pain point

We talk about this as if asking them would be simple, but it isn’t. Many times, people aren’t even aware of their own problems. It would be simple to fix a problem if they were aware that they had one. They typically have a vague sense that something is off, but they are unable to explain what. Now, that’s your job. Many businesses who would have succeeded failed on that note. Don’t be one of them.

They were not cash-efficient

Companies must be capital-efficient—that is, extremely judicious about the cash they have. Every decision needs to address how to keep overhead low. Working from home, relying on contractors instead of staff—anything to preserve capital. In the end, capital efficiency enables you to take bigger risks. How bold could you be if the cash in your business account could cover your expenses for one whole year? It may be tempting to hire JUST anyone. But successful companies set high hiring standards and take the time they need to find the right people who would create the right strategy to drive the business. Please take note.

You see?

Success leaves clues and so does failure. To avoid the pitfalls that lead could lead you to epic fails, make sure you solve a market need, maintain your cash and hire the best team possible. Above all, let consumer intelligence inform all your decisions.

Are you a brand or consumer, please make it a duty to always visit CONSUMERTRICS for updates in this regard.

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