Main Failures of Small Businesses

There is a common belief that starting and managing a small business is easy, but it's important to consider that entrepreneurship can also be quite risky. For example, 33% of small businesses fail within the first two years of operation, and 50% fail within the first year. We decided to present you with some of the main causes of failure to help you avoid potential mistakes.The main reasons for failure are:Lack of Financing or Working Capital: One of the primary reasons for business failure is the absence of funding or working capital. Sometimes, the ongoing costs of the business exceed what was originally planned, and to continue operations, it's necessary to replenish the company’s financial resources.Offering Prices Below Market Value: A second key reason for failure occurs when a company enters the market offering a product or service at a price lower than the market value. While this can sometimes help attract new customers quickly, it's not always effective in the long term.Lack of Financial Resources to Add New Products: Another cause of failure arises when a company needs to introduce a new product but doesn't have the necessary additional financial resources, causing it to fall behind the competition and lose its market position.Failure to Account for Marketing Costs: One of the most common failures of business owners is not considering the capital required for the company's marketing needs. Since marketing is a crucial component, this often results in failure to enter the market successfully.Thus, one of the key prerequisites for sustainable business development is realistic planning of the current budget and timely infusion of financial resources.Regarding the issue of financing, AYS Credit offers business loans for various purposes that can support your business’s growth.