In 2017, the US Small Business Administration Office of Advocacy reported that the U.S. saw 1 million new businesses open, while 898,000 businesses closed. That means even in a normal year, the U.S. can still see an average of nearly 2,500 daily business closures.
Eighty percent of all businesses fail within the first 18 months, according to Forbes.
Business ownership is the most dreamed-about career option in the United States. More than one-half of the adult population, 57%, would opt for self-employment according to one Gallup Poll.
The survival rate for small business start-ups is an important figure to know. Of those 70 million-plus people, less than one percent (about 600,000) take the leap each year.
Why? Because most lack the focus, planning skills, and personal insights needed to overcome fear and other obstacles. That is what this article is about. Giving you the focus, planning skills, and personal insights needed to overcome fear and other obstacles.
Exploring the causes of small business failure before you start your own company may help you avoid that fate.
This Special Report Will Help You Eliminate Business Failure, Losing Your Business or Startup, and $30,000 and $40,000+
Have you been asking, How Much Money on Average Could You Lose Starting a Small Business?
According to the U.S. Small Business Administration, a traditional “Brick and Mortar” varies depending on the type of business.
According to the U.S. Small Business Administration, most microbusinesses cost around $3,000 to start, while most home-based franchises cost $2,000 to $5,000.
Most Common “Brick and Mortar” Startup Expenses
It’s important to understand the different types of costs you’ll have as a new business. Theoretically, it’s good to take note of what costs are fixed, variable, essential or optional. But let’s get concrete. Here’s a short list of costs you’ll likely have as a new business:
- Web hosting and other website costs
- Rental space for an office
- Office furniture
- Basic supplies
- Basic technology
- Insurance, license or permit fees
- Advertising or promotions
- Business plan costs
Typical costs for startups
The following table estimates very basic fixed costs for a hypothetical startup company with five employees. Variable costs will depend on each business’s situation and are not included in this table.
|Rent||Coworking space membership||$2,750|
|Website||Design and hosting||$2,000|
|Payroll||5 employees with a $35K/year salary||$175,000|
|Advertising/promotion||PPC buys in your sector||$5,000|
|Basic office supplies||Paper, pens, etc.||$80|
Possible Average, Startup and First Year Losses
On average, startup and first-year costs often fall between $30,000 and $40,000. However, it is possible to start a business with an initial investment of $0, $100, $1,000, all the way up to millions of dollars.
For example, an online business with no inventory may only require a couple hundred dollars for a website and marketing, while a brick and mortar business may cost hundreds of thousands for a location, furnishings, and equipment. Some businesses also have variable costs, like products and staffing that increase with sales.
For too long, prospective entrepreneurs have been without a critical ingredient; Knowledge of business failure and a proven system that can take them from wanting to be in business to actually being in business.
Even more disturbing is that more than one-half of new ventures will not survive for even five years and will result in a loss between $30,000 and $40,000 in the first year alone.
It’s a tragedy that once aspiring entrepreneurs finally get into business, less than half will succeed.
It’s tragic on two levels. First, small business failure results in personal and financial loss. And second, small business failure takes away from the overall economy.
Consider the Loss of these 12 Small Startup Costs
The upfront costs that small businesses incur vary greatly. After all, you can look for businesses to start with $1K, but that is not for everyone. Some costs are fixed and they are fairly predictable, while other costs vary widely. Though these may not all apply to your specific idea or industry, here are some common business costs for entrepreneurs to consider.
Incorporation involves setting up a business structure and filing all the necessary legal paperwork with your state and local government. You can hire a corporate lawyer or file paperwork yourself. Fees vary by location but are often just a few hundred dollars.
A website makes your business look legitimate and gets your products or professional services in front of potential buyers. There are free website builders, but custom domains and advanced features can cost tens to hundreds of dollars.
Advertising and marketing costs are considered variable expenses, since they change based on your company’s budget and goals. It’s not absolutely necessary to advertise upfront. But it can help you reach customers who otherwise wouldn’t know about your offerings. You can set your own budget on platforms like Facebook and Google, starting at just a few dollars.
Product expenses vary based on how much inventory you need to purchase upfront and the cost of your items. In addition to the actual purchase, factor in shipping costs and storage space. There are often bulk discounts, but purchasing too much inventory also comes with more location or storage expenses. Budget anywhere from a few hundred to hundreds of thousands for this category, depending on the cost of your goods or supplies.
5. Business Insurance
General liability insurance protects businesses from legal expenses incurred due to damages or injuries incurred on your location or as a result of products or services. Some businesses may also benefit from property insurance, errors and omissions, and auto or business policies. Typical expenses for this startup cost start at a few hundred dollars per year.
Many businesses use accounting software and similar tools to manage daily operations. These programs may have a small monthly fee or a one-time purchase cost. Budget tens to hundreds of dollars annually for this expense.
7. Business License
A business license is a permit required by many states or counties. Small business owners spend between $50 and a few hundred on this expense. If you already have an attorney, they may file it for you, so just roll it into your legal fees.
8. Physical Location
Brick and mortar stores or companies with a physical office will need to factor in rent or mortgage expenses. Don’t forget utilities as well. Depending on size and location, this can cost a couple thousand per month or more.
Equipment costs vary widely. Businesses that need heavy manufacturing or construction machinery should plan to spend thousands to hundreds of thousands, while companies that sell handmade products and just need small items like vacuum sealers or label makers may just spend $20 to $50.
If you have a retail or office space, factor in furnishings like chairs, desks, and cabinets. Depending on the size and type of furniture needed, this can cost a few hundred dollars to several thousand.
If you need help running your business, recruiting and payroll can represent major expenses. The amount depends on the size of your team, their skills and experience, how many hours they work, and your location. Generally, you can expect to spend thousands of dollars a month for each employee.
Taxes accrue based on how much you earn. But it’s important to set money aside so you don’t get hit with a huge bill at the end of the year. Federal corporate taxes are 21 percent. And factor in state taxes as well.
Reasons for Small Business Failure At a Glance
- Not tracking your business
- Lack of a business plan
- Not running on a system
- Lack of management experience
- Not having a predictable schedule
- You’re too cheap
- Unexpected growth
- Lack of vision and prediction
- No use of technology
- Personal use of business funds
- Not having protocols for everything
- No deadlines
- Rarely hitting goals
- Over-investment in fixed assets
- Poor credit arrangements
- Lack of expertise in crucial areas
- Lack of financial analysis and review
- Higher competition, lower sales
- React instead of initiate
- Lack of urgency
- Not knowing what you want
- No desire to learn
- Lack of experience
- Insufficient capital
- Poor location
- Poor inventory management
- Underestimating the need for strategic planning
- No creativity and innovation
- Wrong niche selection
- Poor pricing
- Team breakup, not right people in the right place
- No competitive advantage
- Ethical failure
- Poor leadership
- insufficient commitments
- No market demand
Business Plans Do Not Totally Protect Against Loss
Government, schools, and professional advisers insist that business begins with business planning. But the most successful business owners, consciously or otherwise, first understand themselves as entrepreneurs. They also know, consciously or otherwise, what type of venture suits them, and how they fit inside of that venture.
Entrepreneurship must first be about the entrepreneur. Personal planning should always precede business planning, but generally, it does not. If one is to take this high-risk journey, one must first consider self before all other factors.
To study and interact with both failed and successful entrepreneurs is to understand why small businesses fail and why they succeed. Business plans change. The nature of the individual entrepreneur does not.
The first step in business ownership should be gathering up quality weapons to do battle. But traditional weapons such as capital (sometimes too much) and business plans should not be deployed first.
Capital and business plans alone are not formidable enough to overcome the high rate of small business failure. Leaning on elements beyond the person, the entrepreneur, is central to why small businesses fail.
The Pressures of Low or Negative Margins and Employee Turnover will Create a Downward Spiral for Many Small Businesses this year.
The combination of inflation, poor first-line leadership, and expensive mistakes spell trouble for low-margin small businesses. The pressures of low or negative margins and employee turnover will create a downward spiral for many small businesses.
Starting a small business is an exciting, refreshing opportunity and for some it may have even been an idea which was in the making for many years. However, while there are many things that small business owners look forward to, there are also many challenges and pressures that they need to be prepared to deal with.
Especially in today’s competitive marketplace where many businesses have adopted the ‘why you should choose us above anyone else’ approach when targeting customers. This means that most businesses try to highlight the benefits a customer receives when choosing their services, and sometimes even try to exploit gaps in their direct competitors’ services.
ONLY YOU CAN PREVENT LOSS
Lowering the rate of small business failure means increasing awareness as to how self-employment is approached. The difficulty lies not in acknowledging the problem, but in not having a means of discovering one’s entrepreneurial self and potential fit before start-up. The most successful entrepreneurs are gifted with the ability to know how they might fit into business ownership. For others, the connection is not self-evident.
The missing weapon is a personal plan based on greater knowledge of oneself and the truth about where we belong, if at all, in the world of self-employment. If there’s one single factor for why small businesses fail, it’s a lack of self-understanding that leads to poor choices.
It’s not a business that makes a success of the entrepreneur. It’s the entrepreneur, who, if well prepared, makes a success of the business.
Simply put, to increase the chances for successful self-employment, the self-employed must know their entrepreneurial self and build a venture around those findings.
Small businesses fail when a person falsely believes they are entrepreneurial material and/or they do not choose a venture that, in some way, reflects themselves, their personality and their needs.
You are the Key to Success
Successful entrepreneurship requires the ability to simultaneously make quality judgments about both personal and business issues.
Above all else, business ownership is a human endeavor that embodies the personality, goals and abilities of the owner. Yet, conventional wisdom disregards the more human side of self-employment.
It focuses almost exclusively on business processes such as writing a business plan, raising capital and marketing. Each of these is important, but they pale in comparison to the importance of the person taking the risk.
The prime reason why small businesses fail is that people do not first understand how, if and why self-employment might be a wise choice.
Entrepreneurship is about building and maintaining a strong, healthy, personal relationship with one’s venture. Tradition ignores this fact because it’s not popular, not understood, and may even be too personal to have a place in business.
Wrong thinking has cost too many people too much and is exactly the problem with the conventional approach to entrepreneurship. Successful entrepreneurship flows from understanding one’s self as well as one’s business ideas.
Prevent Loss by Appling this Million Dollar Business Success Formula
The method by which your DESIRE to build a business and for riches can be transmuted into its financial equivalent, consists of six definite, practical steps, viz:
- First. Fix in your mind the exact kind of business you want and the amount of money you desire from that business. It is not sufficient merely to say “I want plenty of money.” Be definite as to the the exact type of business you want and amount of income or profit you want it to generate. (There is a psychological reason for definiteness which will be described in a subsequent chapter).
- Second. Determine exactly what you intend to give in return for building the business or for the money you desire. (There is no such reality as “something for nothing.)
- Third. Establish a definite date when you intend to have the business build or possess the money you desire from your business.
- Fourth. Create a definite plan for carrying out your desire, and begin at once, whether you are ready or not, to put this plan into action.
- Fifth. Write out a clear, concise statement of the business you desire and the amount of money you intend to acquire, name the time limit for its acquisition, state what you intend to give in return for the money in your business, and describe clearly the plan through which you intend to build the business and accumulate the income and profit.
- Sixth. Read your written statement aloud, twice daily, once just before retiring at night, and once after arising in the morning.
AS YOU READ-SEE AND FEEL AND BELIEVE YOURSELF ALREADY IN POSSESSION OF THE BUSINESS AND THE MONEY. It is important that you follow the instructions described in these six steps. It is especially important that you observe, and follow the instructions in the sixth paragraph. You may complain that it is impossible for you to “see yourself in possession of the business or the money” before you actually have it.
Here is where a BURNING DESIRE will come to your aid. If you truly DESIRE the business or the money so keenly that your desire is an obsession, you will have no difficulty in convincing yourself that you will acquire it.
The object is to want the business or the money, and to become so determined to have it that you CONVINCE yourself you will have it.
To the uninitiated, who has not been schooled in the working principles of the human mind, these instructions may appear impractical. It may be helpful, to all who fail to recognize the soundness of the six steps, to know that the information they convey, has created many businesses and have created considerably more than one hundred million dollars.
Will You Pay the High Cost Of Loss and Failure?
The high failure rate of small businesses represents devastation to millions of bank accounts and the families draining them. Failed businesses lessen job opportunities for others, reduce the tax base, fund fewer government works, and offer up smaller numbers of budding major companies.
Low success rates for small businesses fuel a negative chain reaction throughout our economic system. Emerging entrepreneurs are national treasures but their high failure rate is not a priority for government, academia or any other associated entity.
48 Typical Small Business Causes of Loss and Failure
Nightmare : Failure of Apply the 6 Step Success Formula Results in Failure
Eighty percent of all businesses fail within the first 18 months, according to Forbes. Ninety-six percent of all businesses fail within 10 years (Inc.) because they fail to apply the Business success Formula. Startup Failure Rates in 2022 – (Source: Zippia)
- 90% of new startups fail.
- 75% of venture-backed startups fail.
- Under 50% of businesses make it to their fifth year.
- 33% of startups make it to the 10-year mark.
- Only 40% of startups actually turn a profit.
- 82% of businesses that fail do so because of cash flow problems.
- The highest failure rate occurs in the information industry (63%).
- Only 40% of Startups Actually Turn a Profit.
- 30% of startups break even.
- Startup Failure Rate Occurs in the Information Industry (63%). (Source: Failory)
- Construction has the second-highest failure rate of any industry, with 53%.
- Manufacturing comes third, with 51%.
- Mining has the fourth-highest failure rate, with 49%.
- The finance, insurance, and real estate industry has a success rate of 42%.
Failure rates vary significantly across various industries.
Plumbing, construction, and local trucking have the lowest success rate of startups. The mining and manufacturing industries are especially challenging, as is, perhaps somewhat surprisingly, the information industry.
Nightmare : Not Knowing the Small Business Statistics
In June 2021, The Zebra, a small business insurance comparison site, conducted a national survey of former and current small business owners in order to better understand the struggles, goals, and motivations behind becoming an entrepreneur.
Small businesses are a vital pillar of the American economy, yet so many fail each year. The coronavirus pandemic last year was especially difficult for small businesses that did not have an online presence. Our research team looked further into what makes operating your own business so difficult.
- Over one-third (32.8%) of small business respondents identified “lack of capital” as the #1 reason why the business had to close.
- Other factors included strong competition (19.6%), unsustainable growth rate (18.75), and lack of market interest (17.5%) as other factors for business closure.
- Only 1% listed COVID as the cause of their business failure.
The survey further revealed that marketing plays a large role in the day-to-day concerns of small business owners:
- The overwhelming majority of participants (81.4%) responded that their primary form of marketing was word-of-mouth — telling family and friends personally about their new business. This was followed by social media (49.3%) and a company website (37.4%).
- 41.2% decided if they would focus more money on marketing efforts.
- Of those with a website to promote their company, 15.5% only used safe passwords to protect against cybercrimes. Only 6.6% had set up a VPN.
Our 2021 survey allowed for broad insight into common motivations and reasons for longevity for small business owners:
- 57.8% of our respondents were open for less than 5 years.
- Only 5% survived longer than 30 years.
- 81.7% of small business owners opened their business to be their own boss.
- Only 16% intended their business to be a financial legacy for their family.
- If given the opportunity to change something about their business, our respondents cited: “Different partners”, “better cash flow”, and “better business education” as the top responses.
Nightmare : Not Knowing the Reality of Small Business
The following statistics come from large data reports generated by the Small Business Administration’s Office of Advocacy.
- From 2019-2020, applications for new businesses increased by 24%
- As of 2020, 69% of all startups are home-based.
- 50% of all small businesses are run out of the owner’s home.
- In May 2020, 57% of small business and medium business owners said they will continue to offer remote work options in the long term.
- Because of remote work, small business owners report a 19% increase in employee availability and a 7% increase in life satisfaction.
- 73% of small businesses will be expected to be remote by 2028.
- On average, 50% of businesses view marketing as their main strategy for growth.
Nightmare : Not Knowing Why Failure Happens
- 50% of small enterprises fail in their first 12 months of being open.
- 42% of small businesses fail because of a lack of demand in the market for their product.
- Over two-thirds (66%) of small businesses significantly struggle financially.
- Across the United States, over 543,000 new businesses open every month.
- 25 – 45% of businesses are no longer able to stay open after a significant financial crisis.
- Only 25% of small businesses survive 15 years or more.
Nightmare : Not Knowing or Understanding Small Businesses and Revenue
For further insight, review the full reports from the Small Business Administration’s Office of Advocacy, and Guidant Financial.
- The COVID-19 pandemic and the subsequent lockdown forced almost one-third of all small businesses in the United States to close down permanently.
- Over 98% of small businesses employ fewer than 100 employees and
- 89% employ fewer than 20 employees.
- 47% of the private-sector workforce is employed by a small business.
- Small businesses employ more than 59.9 million people
- 23% of small business owners list lack of capital or cash flow as their number one challenge.
Nightmare : Not Knowing the Demographics of Small Business
- Women make up 26% of small business owners, increasing by 10% year over year.
- LGBT-owned small businesses represent less than 1% of small businesses
- 34% of all female small business entrepreneurs have at least a bachelor’s degree.
- 71% of small businesses run by women are profitable while 80% of small businesses men-led are profitable.
- 36% of Black small business owners opened a small business because they were ready to become their own boss, and 17% were disillusioned with corporate America.
- 42% of Black entrepreneurs report they are very happy as small business owners.
- 49% of small business loans from banks go to white-owned businesses, while only 3% of loans went to Black-owned businesses.
Nightmare : Not Knowing the Decline of Small Businesses
Forbes and Inc.com are both the sources of the following statistics:
- The number of small businesses fell 52% while their payroll expenses dropped 54% in the months of April, May, and June of 2020.
- During the coronavirus pandemic, companies that experienced profit declines of up to 87% were forced to close.
- More than 40% of 25-to-34-year old Americans said a fear of failure kept them from starting a company
- Over the past 30 years, new business creation has declined by almost 50%.
- In 2019, 30% fewer small businesses started than in 1970.
- The founding and creation of tech start-ups in the US are on the decline.
Nightmare : Not Knowing the Importance of Small Business Cybersecurity
These statistics come from reports by SEMRush, 99Firms, Guidant Financial, Top Digital, and Fundera.
- More than 80% of small businesses today are using technology to promote products
- By 2040, almost 95% of all consumer purchases will be made on an eCommerce website.
- Medtech start-ups return an average net profit margin of 12.1%, making them in the top ten of the most profitable small businesses.
- In 2019, 64% of businesses had a website.
- 70% of consumers learn about a new business online, either through a website or social media.
- About two-thirds of small businesses are completely online.
- 43% of all cyberattacks target small businesses.
- 60% of small businesses that become victims of a cyber attack are forced to go out of business because of loss of revenue and security.
Nightmare : Not Knowing of Small Business Lawsuits
For further information, consider the full reports by SmallBizDaily, Forbes, RocketLawyer and Practical Business Knowledge.
- 36% to 53% of small businesses are sued every year.
- 43% of all small businesses are threatened with a lawsuit every year.
- About 45% of small businesses are currently involved in litigation.
- 90% of all businesses experience a lawsuit at some point in their lifespan.
- There are around 12 million contract lawsuits filed every year against small businesses.
- The average liability suit costs at least $54,000.
- Over 75% of small business owners are concerned that they’ll be targeted for a lawsuit.
- A small business earning $1 million a year would typically have $20,000 in litigation fees.
Nightmare : Not Knowing of Business Loan Defaults
The following statistics are taken from reports by 99Firms and Fundera.
- The average small business bank loan amount is $633,000.
- Major financial institutions approve only 26.9% of small business loans.
- 43% of small business owners have applied for a loan from a small business lender.
- Only 48% of small business owners claim they have all the funding they need but 29% fail due to lack of cash flow.
Nightmare : Not Understanding Business Insurance
The purpose of business insurance is to protect against accidents, lawsuits, natural disasters or other unexpected events that could put your business at risk.
Given that 43% of all small businesses are threatened with a lawsuit every year, small business insurance is a necessary purchase.
There are many different types of coverage available, including general liability, workers compensation, commercial property, professional liability, cyber liability, and commercial auto insurance, and the size of your business will influence how much you pay.
If your business is conducted entirely online, you may be able to add an endorsement to your current homeowners policy that can cover your needs.
If clients regularly visit your place of business — for instance, a home daycare or a massage therapy center operated from your home — then an endorsement is not likely to be enough. You’ll need to procure a separate commercial insurance policy to be properly covered.
Nightmare : NOT KNOWING OF THE REASONS FOR FAILURE
[A]: According to research done by U.S. Bank and cited on the SCORE/Counselors to America’s Small Business, the reason small businesses fail overwhelmingly includes cash flow issues. This includes poor cash flow management and poor understanding of cash flow, starting out with too little money, and lack of a developed business plan.
- 82% – Poor cash flow management skills/poor understanding of cash flow
- 79% – Starting out with too little money
- 78% – Lack of well-developed business plan, including insufficient research on the business before starting it
- 77% – Not pricing properly or failure to include all necessary items when setting prices
- 73% – Being overly optimistic about achievable sales, money required, and about what needs to be done to be successful
- 70% – Not recognizing or ignoring what they don’t do well and not seeking help from those who do
[B]: No Market Need Is the Number One Reason Why Startups Fail. (Source: Failory)
- Marketing is another major reason for failure.
- Team problems are a contributing factor to startup failure.
- Little experience of CEOs and Directors is also a common characteristic of failed startups.
[C]: Most failed startups tend to have several things in common:
First, insufficient competence can result in emotional pricing and a lack of planning.
Second, inexperienced founders often buy the wrong inventory or make bad decisions.
Third, poor advice from friends and family, in addition to family commitments, piles on the considerable pressure of running your own company and impacts what percentage of business startups fail.
Fourth, 82% of Businesses That Fail Do So Because of Cash Flow Problems. (Source: Fundera)
- 79% of businesses that fail start out with too little money.
- 77% of businesses do not have appropriate product and/or service prices.
- 73% of businesses have overly optimistic sales estimates.
Fifth, Most startups fail due to money-related issues. Sound financial planning is absolutely crucial when running a business, and that includes business credit cards with the lowest interest rates and best rewards.
However, many entrepreneurs underestimate the potential difficulties. The volume and timing of sales are particularly difficult to project, which can cause significant cash flow problems down the road.
Nightmare : Not Knowing of the Failure Rate by Industry
The Highest Startup Failure Rate Occurs in the Information Industry (63%). (Source: Failory)
- Construction has the second-highest failure rate of any industry, with 53%.
- Manufacturing comes third, with 51%.
- Mining has the fourth-highest failure rate, with 49%.
- The finance, insurance, and real estate industry has a success rate of 42%.
Failure rates vary significantly across various industries. Plumbing, construction, and local trucking have the lowest success rate of startups. The mining and manufacturing industries are especially challenging, as is, perhaps somewhat surprisingly, the information industry.
Nightmare : Not Knowing of the Reasons Why Most Established Businesses Fail
A great deal of ink has been spilled over the years regarding why this happens. Some blame the government. Some suggest it’s just poor economic luck, or bankers not willing to help them out, or bad marketing, or a million other factors.
But at the end of the day, the success or failure of a business comes down to what the person at the top did (or didn’t do). It can be very hard for a failed business owner to accept that perhaps their business failed because of personal mistakes. However, understanding your own weaknesses is one of the most important things that a person can do in life, never mind business.
The key mistakes business owners make that contribute to these staggering trends are:
: Unprofitable Blind Spots
The biggest mistake comes down to money. At the most basic level, every single failed business fails because they ran out of money. A business owner may have the most fantastic, wonderful idea in the world. But if that idea isn’t turned into a profit, they’re wasting time.
: Misunderstandings and Missteps
More importantly, an unbalanced approach to earning a profit will limit a business’s creativity. There are numerous examples throughout history of how successful businesses refused to innovate because they wanted to stick with what had made money, be it shipping containers or film cameras. Think of Kodak’s digital missteps. In recent years “digital technology changed photography dramatically, and Kodak, a former heavyweight in the analog film business, got left behind
In the United States, small businesses, mom-and-pop shops, and entrepreneurs are the backbone of our economy. But these businesses often operate with less than fifty employees and depending on a variety of economic factors, they can be susceptible to failure.
Lack of cash flow, lack of market interest, and strong competition are some of the top reported reasons small businesses fail.
Despite these risks, thousands of small businesses are started every day and every day, more and more Americans choose to be their own bosses. There’s a lot of reward that comes with being a small business owner, but there’s also a lot of risk.
More Reasons for Loss and Failure
Nightmare : Not Knowing About Capital
The challenge: You want to grow or start your new business endeavor, but you’re facing difficulties for financing for new business owners.
The solution: Though various ways are there for arranging small business funding, starting from friends and family to conventional bank loans, many experienced entrepreneurs believe that self-fueled growth model is the best and less-risky one.
Instead of trying to establish a big business house overnight, aim at your primary customers. If you can provide value added services to them, by the virtue of word-of-mouth publicity, your business will develop automatically. However, if you need to take outside funding anyway, don’t forget to consult an attorney to avoid future complications.
Nightmare : Not Knowing Right Business for You
The challenge: Two of the most crucial reasons behind failing of new construction entrepreneurs are the inability of selecting the right trade or business and doing it in the proper manner e.g. ethically.
The solution: Firstly, to attain success in your new business endeavor, you’ve to have an outstanding construction service or product that adds value to your customer’s life.
Secondly, you’ve to maintain your ethics. Having said that, you’ve to deliver exactly what you’ve committed to. Because if you fail to do so, again by virtue of word-of-mouth publicity, you’ll hardly have your business expanded as you’ll fail to attract new customers or retain your existing clientele. Remember – it’s easier to attract first time customers, but it’s much more difficult to retain them.
Nightmare : Not Understanding Cash Flow
The challenge: Small construction businesses can’t survive if they don’t follow cash flow guidelines and this is probably one of the biggest problems that new entrepreneurs face.
For example, you perform a job timely, raise the invoice and get paid after a month. In the meantime, you’ve to bear all your business related expenses like your infrastructural cost, your employee’s salary and additionally, your personal expenses. And in case you don’t get paid at all, only some miracle can help you out.
The solution: Proper planning and budgeting are crucial for maintaining cash flow. One way to increase cash flow is asking for a down payment whenever you receive an order. That way, you’ll be able to pay your expenses and that too while keeping some profit aside.
Another way of increasing cash flow is asking your clients for faster invoice payments. Say, instead of 30 days you can ask your clients to clear your invoice after 15 days. That way, if the client is late on payment, you’ll still have some time.
The third way is a little uncommon and it entirely depends on your rapport with your own vendors. If you can manage to make your vendors agree to invoice you after 45, 60 or 90 days, you’ll have sufficient time to receive your payments and then clear their invoices.
Nightmare : Not Knowing the Number of Competitors
The challenge: Dealing with too many competitors in the same field.
The solution: Bring in something trendy and new in the market. Customers flock to a business that offers extensive service or product knowledge and a wide collection of services or the products they’re looking for.
Nightmare : Not Knowing How to Hire Employees
The challenge: The hiring process can become a nightmare for most of the new construction entrepreneurs. After completing all the steps of recruitment like reviewing resumes, taking interviews etc, at times, they end up hiring an incompetent trades person.
The solution: Consider being a Union contractor. and use the Hiring Hall of the certain trade.
The second solution: Go through the ‘wanted’ part of the job sections of newspapers. You’ll be able to shortlist some candidates according to your requirements.
Next, you can organize a ‘walk-in interview’ and offer them a tour of their future working environments. Next, sit with them across the table and finalize things. Remember to make everything clear for both sides because that’ll be extremely helpful to create a healthy work relationship and hire the ones that fit the vacancies, with respect to both their skills and attitude.
Nightmare : Not Knowing How to Find Find Customers
The challenge: Finding prospective customers.
The solution: If your product/service adds value to people’s life or construction project, you don’t need to spend a huge amount of money on advertising in the initial stages. If you’ve a great product/service, people will automatically come to you. Just remember to keep your patience and approach only those people who show interest in your business.
Nightmare : Not Knowing Time Management
The challenge: Time management is probably the biggest problem, especially for the new construction entrepreneurs. In your own business, you’ve to take care of everything unlike a regular job where you only have to take care of certain tasks.
The solution: You’ve to enhance your time management skills. Following are some useful tips:
- Create goal lists: Make a lifetime goals list and break it down to annual, monthly, weekly and daily goals. That way, your daily goal will be in front you and you just have to be on track.
- Delegate the jobs that don’t require your personal involvement.
- Simply eliminate the unnecessary tasks.
- Assess yourself on a regular basis.
- Strictly follow project schedules.
Nightmare : Not Knowing How to Delegate Tasks
The challenge: Probably due to their inexperience, new construction entrepreneurs often get things messed up when it comes to delegating tasks and they’ve to redo it all over again.
The solution: If you’ve a team of good employees, this job becomes much easier. Taking the help of good outsourced Union or agencies is another way of performing this task easily. The latter might be a little costly but it’ll help to get the tasks performed efficiently and in a time saving manner.
More importantly, remember to be absolutely specific about your requirement so that tasks are delegated with clear guidelines, which in turn would help to get them completed on time, in an efficient manner.
Nightmare : Not Knowing How to Find Business Partners
The challenge: Finding reliable business partners is one of the most critical jobs that a new construction entrepreneur has to perform. A wrong business partner will provide you with a negative reputation and as your reputation will be connected to your partner, you’ll be risking the success of your endeavor somehow.
The solution: It’s difficult to judge your partner at the first sight, but if he/she has the wrong intentions, it’s bound to be revealed gradually. The only way out is to immediately dissolve the relationship with your partner.
Nightmare : Not Knowing-Choosing What to Niche to Sell
The challenge: One of the biggest reasons for the failure of new entrepreneurs is selection of the wrong niche.
The solution: It’s very common that being a newcomer in the entrepreneurial world, you may not have the adequate expertise to select a profitable niche. In that case, hire a freelance market researcher who will survey the related market e.g. the field you want to do business in, and prepare a report of profitable niches. You can then analyze the report and decide on your preferred niches.
Nightmare : Not Knowing the Strategies for Marketing
The challenge: You’re unaware about the best possible way to market your products/services. Your aim is to maximize your ROI with effective and targeted marketing.
The solution: Again, it’s a useful idea to outsource the marketing part to another third party who has adequate expertise. Prepare a marketing budget and hand it over to them and they’ll chalk out an efficient marketing plan. Remember not to take the chance of experimentation at this stage. You can perform that later when you’ve a productive baseline.
Nightmare : Being Strapped By a Budget
The challenge: Even when you’ve adequate cash flow, it looks like you’ve a strapped budget to exhibit your products/services to their full potential.
The solution: Admit that every entrepreneur faces the phases of having a strapped budget. You can lower the number of the situations by effective marketing efforts. Spend the money where it maximizes your ROI and stock the rest for other infrastructural and experimental expenses.
Nightmare : Having Self-Doubt
The challenge: Every new construction entrepreneur goes through a phase where he/she starts lacking self-confidence and feels like quitting. It mainly happens due to initial failures and watching the growths that are lower than expected.
The solution: You’ve to overcome self-doubt to become a successful construction entrepreneur. Discuss the matters within your close circle who are aware of your goals. You may even seek the help of fellow construction entrepreneurs, some of whom will be ready to offer advice and show you ways to overcome the hurdles during this phase.
Whether you’re thinking of becoming an construction entrepreneur or have just entered the domain, be prepared for these challenges. To achieve success, plan strategically, explore the possible ways, bring in a great product or service to the market and finally, do good business.
Nightmare : Not Understanding Safety Requirements
Worker safety continues to be an issue plaguing the construction industry. For years, construction has led all industries in the total number of worker deaths. The number of workplace injuries and illnesses has remained constant for years. Keeping workers safe and protecting them against accidents and injuries should be the top priority for all business owners.
The median time away from work after suffering an injury or illness on the job in construction is 10 days. Of the 82,760 accident injuries involving days of work missed in 2016, 26,010 of them involved 31 days or more away from work, which works out to nearly a third of all accident injuries requiring days away from work. That’s a massive amount of lost productivity due to injuries and illnesses.
Training is the number one way to keep workers safe on the jobsite. Safety training shouldn’t be a one-time event. Ongoing training is needed throughout a worker’s career to emphasize the importance of safe working practices and to reinforce the lessons they’ve been taught. There’s no such thing as too much safety training.
Accidents are easily preventable when hazards have been mitigated and safe work practices are strictly and vigilantly enforced. Safety starts at the top and companies that have strong safety programs have been shown to be more productive. A commitment to safety can improve a construction company’s reputation and attract top talent by showing an interest in the well-being of its employees.
Nightmare : Not Knowing Technology Adoption
The construction industry, as a whole, is notoriously slow at adopting new technologies. Countless studies and surveys over the years have shown that business owners continue to underinvest in technology, despite their acknowledgment of the many benefits that technology can provide to running their business and managing construction projects.
BIM, telematics, mobile devices and software applications have all been in use in the construction industry for a number of years. Emerging technologies like VR and AR, robots, drones, 3D printing, the Internet of things (IoT), wearables and autonomous vehicles are all being adapted for use in the construction industry.
Ironically, many of these technologies can be used to help address these other challenges the construction industry is facing. BIM, VR, project management software and mobile devices can help with scheduling and planning as well as communication and collaboration which can lead to better productivity.
Drones and wearable are being used to monitor workers and keep them safe. VR is being used to train workers in safe environments and robots and autonomous equipment are allowing workers by alleviating some of the more strenuous tasks they are required to perform while also removing them from some of the more hazardous areas on construction sites. Companies that are adopting new tech also have a leg up on attracting more millennials to come and work for them.
We are quickly reaching the point where technology is going to be a critical component of all construction projects. The companies that are early adopters and are implementing new tech into their workflows and jobsites are going to have a noticeable advantage over those who don’t.
Companies that fail to see the advantages of technology or continue to underinvest in these tools won’t have the competitive edge to survive in this rapidly changing environment.
Nightmare : Having Poorly Defined Goals
This is probably one of the biggest construction management issues to date – no defined goals for a project. The cause of this might be different – with stakeholders either not being able to agree on something or not knowing what they want out of a project themselves.
The problem is that the existence of an unclear goal of a project makes it exponentially harder to manage. Luckily enough, this issue can be avoided, at least to some degree.
For example, construction project managers can ask direct questions to stakeholders from the beginning of a project and continue reiterating them for the entire length of a project’s realization to keep everything consistent
Nightmare : Having Problems with Risk Management
Risk management is another important topic for construction as a whole, and in some cases one of the biggest construction management issues. Risks in the construction industry are far bigger and more costly than in most industries.
Construction managers always have to try and identify potential issues before they become the cause of a project delay or a budget increase. Most of the time it’s important for construction management to gather input and generate mitigation plans beforehand.
Nightmare : Being Unclear About Scope of a Project
This construction issue is so big it’s even got its own name – “scope creep”. It’s a direct result of poorly defined goals, and a lot of such cases end up either over budget or over schedule.
It’s up to construction management to communicate with stakeholders on the topic of scope importance, and the potential delays and/or budget increases that might arise if the issue is not taken care of in time.
Nightmare : Having Issues with Expectations
Another issue for construction that is related to stakeholders is the appearance of expectations that are straight-out unrealistic or unachievable. It’s not uncommon for productivity, in general, to drop in the face of an unrealistic deadline or the lack of resources on site. In this case, it’s up to the construction management to be on the side of regular workers and to advocate for more realistic expectations that can actually be achieved in the specific timespan.
Nightmare : Lack of technological progress adoption
The incredibly slow process of adopting new technologies is basically a norm for the entire construction industry at this point. Despite the fact that many business owners understand and acknowledge a myriad of benefits that new technologies can bring, it’s still a rare occurrence to see a construction business owner investing in adopting a new technology for their business.
The ironic part of this is that a lot of the new technologies can be used to at least partially solve other construction-related problems, like BIM for planning and scheduling, drones for monitoring, VR for training, and so on. Additionally, companies that don’t shy away from newer technologies tend to attract younger specialists – solving one of the bigger hurdles of the construction industry as a whole.
The point of time, where the introduction of some technologies would be inevitable for the company to stay on the market, is getting closer and closer, and early adopters would have a great advantage over more conservative companies in that regard.
Nightmare : Having Productivity Problems
Another interesting topic in this context is how the construction industry has a lot of productivity problems, especially when compared with similar industries, like agriculture or manufacturing. This is even more problematic right now since the complexity of construction projects grows on a regular basis.
Some of the reasons regarding these problems are directly tied with age-old industry issues, such as technology adoption resulting in inadequate planning and scheduling, labor shortage problems resulting in workers not having enough skills for the job, and so on.
As with the previous example, the possible solution for this problem lies in newer technologies and methods, such as design-build method, or lean construction practices – the problem is that both of those require a level of communication that is unachievable without the modern technologies such as BIM, project management software, etc.
Nightmare : Having Safety Concerns
As a highly dangerous industry in general, work safety has been a major concern for construction companies for a while now, with the construction industry dominating the ratings of a total number of worker deaths for decades. Additionally, even injuries that are not fatal result in a relatively long recovery period, often resulting in a worker being out of commission for at least a month or more.
Obviously enough, worker safety should be the number one priority for construction companies, since each missing worker is a huge productivity loss, at the very least. Events like safety training and briefings should not be a one-time thing, but a reoccurring event, to reinforce all of the previously acquired knowledge.
It’s not just about worker level either. A good safety program designed on the highest level of a company and vigilant enforcement of this program often leads to a lot fewer accidents on the site in general, and might even bring some reputational advantages in some cases.
Nightmare : Having Labor Problems
The demand for skilled workers is always growing, and not enough people are interested in working for the industry to meet that demand. This also adds up to a different problem – experienced workers retiring faster than their replacements are getting hired.
There is hope here, luckily enough. Companies seem to understand the severity of this problem, and there’s been an increase in various training and apprenticeship programs, as well as government collaborations to attract more talent in the industry in general. While this is a positive note, the problem of labor shortages has been active for some time now and shows no signs of stopping any time soon.
Nightmare : Not Tracking Your Business
Not tracking the business properly is one of the reasons for small business failure. Think about a cowboy. He has hundreds of cows, that he takes away to the plateau to feed up regularly. The cowboy has no counting about how many cows he has actually. He has not even had enough rope to tie the cows up well and control them on his own.
It is supposed to be a good business, but in fact, it cannot thrive. Some of his cattle loiter away to graze here and there. Finally, these are lost randomly. The cowboy can’t track them well, therefore his number of cows is decreasing day by day.
Now relate this example to the business you are running. You assume it should be going well. But, unless you do not set control and track your business activities, it won’t work well. Track every possible area you come across on the way of your business journey.
All your supply chains, accounts, human resources, and consumers should be under your tracking. Initially, it can be done manually, but you should go for automation in every possible area appropriately. Your mobile, apps, or software can be handy.
To save money, you can develop your manual or even an Excel sheet by any expert. The tracking should be accountable for your everyday activities, big or small. You do not know what small things would be proved costly in the future.
Nightmare : Not Running on a System
The earth moves around the sun. It has a fixed speed and distance it covers at a specific time span. Day and night come one after another, which never overlap each other.
The other planets are following their ways all the year-round. It is the system of the universe that keeps it smooth all the time. This is the perfect system that keeps the earth and all other particles of the universe as perfectly as possible on its goal.
Think about our human body. It is okay as long as the internal body system runs well. When the system crashes, we face sickness of many kinds.
Business is no different than this. It should have its own system. Every successful entrepreneur runs her business in a systematic way. If you don’t have a system, you should develop it. Without a proper system, any business must collapse sooner or later.
Check out whether your business runs with proper procedures and policies or not. You should have the required software, and modules to make your system, there should be an updated accounting system to operate your earnings, profit, loss, receivables, etc.
Keep your HR system okay to fix the roles and responsibilities of your manpower, and also check all activities are running according to the system. Are your employees maintaining office timings? Do your marketing campaigns have a proper schedule? Adopting technology is a good way to develop a system easily.
You’re going to reward tour promising employees for their extraordinary performances, according to your system. If something goes not as per your day-to-day system, you must rely on your recovery system. The summary is that as systematic as you are, your business goes better and better.
Nightmare : Not having a Predictable Schedule
What is your plan this year to travel? How much money do you plan to save? What have you listed down a product list you are going to purchase? What are anniversaries you are going to wish your dear ones? Like a well-planned person, I am sure you have your personal schedule up to date.
What about your business? Have you predicted your business schedule and planned how to handle them? Yes. Whatever the process of documentation is, every business should have a predictable schedule for the future. Not having a predictable schedule is one of the reasons for small business failure.
The schedule can be long-term and short-term. I prefer to go with a long-term schedule segmented into many small schedules. What products are you going to launch in the next 3 months or 6 months? Which clients are you going to handle in the current month or next month? How many sales you have targeted by the next 2 months or four months?
Keeping an updated schedule for your business, and maintaining as much as you can match up, will be good enough. A schedule is a driving force that triggers a businessman to achieve it. What if you can’t keep all of your schedules?
The good thing about keeping a schedule is, that in case you miss some of them by the projected time, your next goal will surely be on the list. When you cannot keep all of your schedules, you can analyze the reasons behind, them and recover the next.
Nightmare : You’re too Cheap
The word “cheap” has many implications in business. Business is all about winning the emotion of the target market. It is to position in the heart. Turn a one-time customer into a permanent customer. Create a unique brand identity for the target group. Set a class impression. And, becoming cheap can be enough to spoil everything you gain.
What is being “cheap” in business? When an entrepreneur undergoes stuff as follows:
- Products that are already superfluous in the market.
- Price of the products as cheap as possible (lowest in the market)
- Make a cheap marketing campaign in a cheap (that has no class) medium.
- Hire cheap, unskilled manpower to save money
Source cheap, low-quality supply chain
- Nurture cheap business ideas
- Set a cheap office space in a low-quality area
- Get a cheap website domain with cheap and unattractive design and erratic content
- Target cheaper market
- Unplanned business planning and execution come out from cheap brains
Avoid being any of these to be a successful entrepreneur.
Nightmare : Not having Protocols for Everything
There should be a sequence of everything. Life has a pattern, it has a decorum. When you start your dress up with a suit and end up with undergarments, what does it look like? Is it the chain of command?
There should be a specific goal for every action associated with your venture. Who should be doing what is to be pre-decided? Action and plan should proceed sequentially. When you maintain a protocol for everything, you get leverage on your objective. Know about the silent killers of business success and how to destroy them.
Nightmare : No Deadlines
Life itself has a deadline. We are approaching death and one day the end of our lives will be appearing. Setting a deadline is a natural rule. It is an awakening of specific triggers that help to execute any job on time. Having no deadline for action is one of the reasons for small business failure.
In the case of a product, there is a depreciation after a certain period of time. When you fix your deadline to finish any job on time, you feel an urge in your heart to finish. Finishing your assignments reaches your objective. You can have your other jobs done as well.
The business should have a deadline to finish any job. Time is valuable. You are not in a situation to let your valuable time in vain. Make your every moment fruitful. Meeting deadlines on small assignments will be a good indication to think and achieve big.
To achieve your short business goals, there is no other way but to set and meet the deadline. Large business goals are part of many small goals. These are crucial factors for your business success.
Nightmare : Rarely Hitting Goals
Sometimes, hitting a goal is much more meaningful than achieving the goal. For a successful business, there should have achievable goals. Having continuous goals (and achieving them) keep a business rolling. What is your business goal this week?
All of your business departments should have their individual goals. Check out what goals are set this week from your business sections- marketing, accounts, HR, product development, training, production, sales, web, research, public relations, IT, and planning. Are these achievable? Do your business units hit these goals?
Nightmare : React Instead of Initiate
Learn to absorb criticism. Show your openness to opinion and recommendations. Feedback is important to rectify your business ideas. Opinions are important for improvement. Some businessmen cannot stand criticism, outbursts come across as a part of the reaction. It’s not fair. Learn how to develop a successful negotiation strategy for your business.
Initiate your action. It is far more productive than showing a reaction. Count your criticism as the trigger for your revenge. Sweet revenge to improve your position, not by reacting, but rather by initiating.
Starting in the very first step of finishing. When you will be reacting, instead of doing, your goal will never end. As an entrepreneur with a big picture in mind, I am sure you don’t want that. Know about the silent killers of business success and how to destroy them.
Nightmare : Lack of Priority
Every action is not equally important. Setting the priority of your actions is a good thing to be on track, to be systematic, and to bring outcomes. Realize the urgency of your action. While setting the there must be the set priority of your sub-tasks. Vision can understand what is urgent and what is not.
It happens in case you need to accomplish multitasks. Calculating the impact of profit, loss, volume, and or impact are good factors to determine urgency as one of the reasons for small business failure. Timing is a good trigger to fulfill urgency. Value your time. In a cricket match, timing is above all other tricks and techniques to batter the ball with the bat to score a sixer.
What you can do now should not keep pending for the other day, in case you sense it as an emergency. You don’t know who else will take the chance today and surpass your efforts. In case it’s urgent to meet your clients than having a meeting with your teammates, do that.
Some businessmen can’t read what matters are urgent and what are not. They always lag behind and eventually leave the business by blaming their fates.
Nightmare : Unclear Vision and Goal
I know a person who is very unstable with his decisions. Three of them started a business selling showpieces. It was a good one. After five and a half years when we met again, he was found in a photography business with other partners.
When I dug deeper, he told in the last 5 years, he changed 3 businesses with 3 groups of partners. As usual, the business was not going well. The reason behind this imminent failure was nothing but his instability in goal setting. He didn’t know what he wanted! He was a man with confusion and dilemma. This important personal trait negatively affected his business career.
Don’t cultivate this blunder! It is you who should know the best what you want. Don’t listen to others. Talk to your soul to have your answers:
- Is this the business of your passion where you are in?
- Can you stick to this for at least 3 years consistently despite any obstacles that may come across?
- Have you set your month-by-month and year-by-year goal in business?
These questions you should consider with authentic answers to decide your days to come. Know about the silent killers of business success and how to destroy them.
Nightmare : No Desire to Learn
Life is a continuous learning process. There are many ingredients in nature, in persons, in incidents, and in examples around us. These are the indications of life. Who can learn from her surroundings, can distinctly make her life differently from others.
As a businessman, you should have a tendency to learn from the environment. Sometimes you have to learn from others, sometimes by doing mistakes in your life.
Whatever the situation, learn. Consistent learning will grow your expertise, you turn experience. Learning has no alternative to shaping yourself up. And there is no end to learning. Know about crucial life lessons people learn too late. Know about the silent killers of business success and how to destroy them.
You can learn from your mentors, your competitors, and other businessmen with whom you have to connect at all. Consider these learning your case studies. Now, you know the reasons for small business failure, and I am sure you will avoid them in order to be successful.
Which Losses or Nightmares Do You Want Eliminated?
Review each question, answer the question and contact us so we can do a FREE Discovery Session with you to help eliminate your nightmares. Also consider the cost of these nightmares to your business and what your goals for resolution should be for your company.
I want the following potential losses or nightmares eliminated.
Eliminate Nightmare #1: The workload is too big? Yes: __ No: __
Eliminate Nightmare #2: Not enough money to last through payment delays? Yes: __ No: __
Eliminate Nightmare #3: Lack of knowledge (business, legal, etc.)? Yes: __ No: __
Eliminate Nightmare #4: Other Contractors? Yes: __ No: __
Eliminate Nightmare #5: Operating Capital and Cash Flow? Yes: __ No: __
Eliminate Nightmare #6: Issues with cash flow? Yes: __ No: __
Nightmare # 7: Planning and Growth? Yes: __ No: __
Eliminate Nightmare #8: Project Complexity? Yes: __ No: __
Eliminate Nightmare #9: Keeping up with compliance regulations? Yes: __ No: __
Eliminate Nightmare #10: Working on a schedule? Yes: __ No: __
Eliminate Nightmare #11: Slow technology adoption speed? Yes: __ No: __
Eliminate Nightmare #12: Communication problems? Yes: __ No: __
Eliminate Nightmare #13: Managing your documentation? Yes: __ No: __
Eliminate Nightmare #14: The problem of “pointing fingers”? Yes: __ No: __
Eliminate Nightmare #15: The lack of a skilled workforce? Yes: __ No: __
Eliminate Nightmare #16: Problem with equipment management? Yes: __ No: __
Eliminate Nightmare #17: Unreliable subcontractors? Yes: __ No: __
Eliminate Nightmare #18: Scheduling? Yes: __ No: __
Eliminate Nightmare #19: Lack of skilled workers? Yes: __ No: __
Eliminate Nightmare #20: Vandalism/theft on site? Yes: __ No: __
Eliminate Nightmare #21: Irregular equipment maintenance/replacement? Yes: __ No: __
Eliminate Nightmare #22: “Forgetful” clients? Yes: __ No: __
Eliminate Nightmare #23: The lack of reliable subcontractors? Yes: __ No: __
Eliminate Nightmare #24: Poor Productivity? Yes: __ No: __
Eliminate Nightmare #25: Rising Cost of Materials? Yes: __ No: __
Eliminate Nightmare #26: Poor Project Performance? Yes: __ No: __
Eliminate Nightmare #27: Going Over Budget? Yes: __ No: __
Eliminate Nightmare #28: Failing to Deliver on Time? Yes: __ No: __
Eliminate Nightmare #29: Lack of Skilled Workers? Yes: __ No: __
Eliminate Nightmare #30: Skilled Labor Shortages? Yes: __ No: __
Eliminate Nightmare #31: Lack of Communication: Yes: __ No: __
Eliminate Nightmare #32: Unreliable Subcontractors? Yes: __ No: __
Eliminate Nightmare #33: Scheduling? Yes: __ No: __
Eliminate Nightmare #34: High Insurance Costs: Yes: __ No: __
Eliminate Nightmare #35: Changing Minds of Project Owners or Homeowners? Yes: __ No: __
Eliminate Nightmare #36: Available Cash? Yes: __ No: __
Eliminate Nightmare #37: Document Management? Yes: __ No: __
Eliminate Nightmare #38: The Blame Game? Yes: __ No: __
Eliminate Nightmare #39: Ever-changing Regulations? Yes: __ No: __
Eliminate Nightmare #40: Capital? Yes: __ No: __
Eliminate Nightmare #41: Right Business? Yes: __ No: __
Eliminate Nightmare 42: Cash Flow? Yes: __ No: __
Eliminate Nightmare #43: Quitting Another Career? Yes: __ No: __
Eliminate Nightmare #44: Too Many Competitors? Yes: __ No: __
Eliminate Nightmare #45 Hiring Employees? Yes: __ No: __
Eliminate Nightmare #46: Finding Customers? Yes: __ No: __
Eliminate Nightmare #47: Time Management? Yes: __ No: __
Eliminate Nightmare #48: Delegating Tasks? Yes: __ No: __
Eliminate Nightmare #49: Finding Business Partners? Yes: __ No: __
Eliminate Nightmare #50: Choosing What to Trade or Niche to Sell? Yes: __ No: __
Eliminate Nightmare #51: Strategies for Market? Yes: __ No: __
Eliminate Nightmare #52: Strapped Budget? Yes: __ No: __
Eliminate Nightmare #53: Self-Doubt? Yes: __ No: __
Eliminate Nightmare #54: Safety? Yes: __ No: __
Eliminate Nightmare #55: Technology Adoption? Yes: __ No: __
Eliminate Nightmare #56: Poorly defined goals? Yes: __ No: __
Eliminate Nightmare #57: Problems with risk management? Yes: __ No: __
Eliminate Nightmare #58: Unclear scope of a project? Yes: __ No: __
Eliminate Nightmare #59: Issues with stakeholders’ expectations? Yes: __ No: __
Eliminate Nightmare #60: Lack of technological progress adoption? Yes: __ No: __
Eliminate Nightmare #61: Productivity problems? Yes: __ No: __
Eliminate Nightmare #62: Safety concerns? Yes: __ No: __
Eliminate Nightmare #63: Labor problems? Yes: __ No: __
Eliminate Nightmare #64: ___________________Yes: ___ No: ___
How Do You Rate Your Business Against Losses, Nightmares or Failure
COMPLETE YOUR BUSINESS RATING ASSESSMENT
On a scale of 1-10 how would you rate your business in the following areas. One being the lowest and ten being the highest.
What are your goals in each of these areas?
Are you meeting your goals for each of the areas?
How much is it costing your business by not reaching your goals in each of these areas?
Cash Flow Ratings
On a scale of 1-10 how would you rate your business in the following areas. One being the lowest and ten being the highest.
- Cash From Operations: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Net Earnings: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Additional Cash: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Net Cash: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Cash Flow from Investing: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Cash Flow Financing: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Cash Flow for Year End: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
Marketing and Sales
On a scale of 1-10 how would you rate your business in the following areas. One being the lowest and ten being the highest.
- Marketing Activities: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Marketing Team: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Marketing Results: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Sales Activities: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Sales Team: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Sales Team Results: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Productivity Activities: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Productivity Team: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Productivity Results: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Operation Activities: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Operations Team: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Operations results: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Credit Rating: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Payment Rating: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Vender Payment Rating: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Bonding Rating: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Insurance Rating: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Business Reality Ratings: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Client-Customer Ratings: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Dunn and Brad Ratings: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Competitive marketplace: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Balancing growth-quality: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Keeping track of trends: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Increasing brand awareness: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Cybersecurity protection: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Social Media Marketing: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Decreased Street Sales: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Sustainability: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Remote Working: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Acquiring Talent: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Mental Health Support: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Lockdowns: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
- Other: Rating Score: ___ Goals: ___ Not Reaching Goal Cost __
WHAT MKS MASTER KEY SYSTEM COACHING CAN DO FOR YOU
Whether you’ve had a family business that has been going for years or you’re just starting in construction, business consulting may not be the first thing you think of when looking at how to build a successful business.
The main responsibility of a business coach is to motivate an individual or an entire team. Coaches are focused on improving your business performance or skills of you or your team by conducting training sessions, coordinating practice drills, and providing guidance.
Our work is conducted both in and out of your office. Coaches are sometimes tasked with a variety of activities to meet profit, cost reduction or management goals.
Selecting a coach may be the smartest business decision you ever make. The right business consultant or coach can bring business tips and ideas for growing your business that you may have never thought of.
Complete Your FREE Discovery Assessments
- Get clear on the issues that created the problem. What really needs correcting here?
- Get clear on everyone’s interests. This will help prioritize the resolution.
- List all possible solutions. Get creative and brainstorm every conceivable outcome.
- Evaluate the possible solutions. Sometimes a simple mark out of ten helps.
- Select the best option.
- Write down the best solution with all the details and implications.
- Make contingency plans. Any change will probably produce a knock-on effect elsewhere. Be sure to have it considered, if not covered!
- Contact us if you need any help in solving your construction business problems.
COMPLETE YOUR 21ST CENTURY BUSINESS ASSESSMENT
- First. Fix in your mind the exact problem you want eliminated. It is not sufficient merely to say “I want plenty of….. “Be definite as to what you want. (There is a psychological reason for definiteness which will be described in a subsequent chapter).
- Second. Determine exactly what you intend to give in return for what you want and what you desire. (There is no such reality as “something for nothing.)
- Third. Establish a definite date when you intend to possess what you want and what you desire.
- Fourth. Create a definite plan for carrying out your desire, and begin at once, whether you are ready or not, to put this plan into action.
- Fifth. Write out a clear, concise statement of what you want or the amount of money you intend to acquire, name the time limit for its acquisition, state what you intend to give in return for the money, and describe clearly the plan through which you intend to accumulate it.
- Sixth. Read your written statement aloud, twice daily, once just before retiring at night, and once after arising in the morning.
Problem solving doesn’t always follow a step by step process so be prepared to jump around the points. This process can be very helpful during a company meeting or a site meeting. Take these steps and formula with you and get other’s input.
In a Nutshell: You CAN solve or eliminate the problem. Go through the formula and steps, with others if possible, and make a note of your solutions.
Additional Take-Away: There’s an important trend developing in some construction companies, they are recording problems and how they get solved so there’s a searchable system in place for the next time that problem arises. There’s no reason to reinvent the wheel each time there’s a problem, so why not start your own in-house system?
Most of our clients double their business revenue within 12-18 months, using our Challenge Assessments and MKS Coaching Programs!
Most of our clients double their business revenue within 12-18 months, while working less hours. We train you, the owner, with our proven programs, how to run a successful and profitable business, while still having time to enjoy your life.
Your industry is quite old and has been through a lot. Some of the problems are extremely old; others have become more prominent in recent years and were not a problem before.
With so many challenges and conflicts facing your industry, it is nearly impossible to overcome most of them on your own. Investing in business coaching you will undoubtedly find your efficiency going up. For Example:
Eliminate New Business Struggles
If you’re starting a new business, there may be challenges you have to face that you may not have anticipated, everything from finding the right vendors for your materials, to acquiring funding, to putting together the right team and finding the right ways to manage them. We has the experience to help you with all of these issues.
Eliminate Team Management Struggles
A team is only as strong as its weakest link, and how you deploy your people is an important factor in how successful your efforts can be. We can assess the strengths and weaknesses of all the members of your team and help you make sure you have everyone in the right place working the right job so that you can optimize your efforts.
Eliminate Marketing Struggles
There was a time when great work would speak for itself, but in the digital age and with rising competition, you need to be able to do more. Knowing how to advertise a business is critical. If your website isn’t performing or if you can do more with your social media pages, our experts can let you know and help you get the most out of your marketing efforts.
How We Work to With You Eliminate Loss or Failure
30+ Years of Experience Helping Businesses Across America and Eliminating Nightmares in All Aspects of Business
Step 1: 30 Min Call (FREE)
- Call us for a free 30-min consultation.
- Discuss your business issues and get expert feedback to address your problems.
- If your business is a good fit we will invite you to proceed to step 2.
Step 2: Strategy Session Call (FREE)
- We will develop a specific action plan for your business or nightmare.
- We will create business strategies to address your problems.
- We will develop a financial model of what your business will look like if you apply these strategies.
Step 3: Coaching Program (PAID)
- You will meet with your coach one-on-one, in person or by video conference.
- Sessions are 1 hr. every week during the planning phase.
- Sessions are 1 hr. every other week during the execution phase.
CONTACT MICHAEL KISSINGER TO HELP YOU- Phone: 650-515-7545
Coaching Helps Your Team Eliminate Loss or Failure
Each step you work through will have exponential growth, followed by a flattening off and slight decline before the next stage kicks in and propels you to the next level of profitability.
But when you have construction business coaching, you’ll get the roadmap to make sure each change of gear is as painless and seamless as possible.
Construction business coaching gives you the tools you need in order to increase your margins, lead your team, establish a strategic direction and systemize your building company. CONFIDENTIAL TESTIMONIALS – mksmasterkeycoaching.com
WE’LL HELP YOU IN YOUR OFFICE, ON THE JOB OR ONLINE WITH THESE COACHING PROGRAMS
- Business and Management Coaching
- Financial Coaching
- Operational Coaching
- Performance and Productivity Coaching
- Legal Strategy Coaching
- Business Marketing Coaching
- Sales Coaching
- Human Resources Coaching
- Owner and Employee Self-Improvement Coaching
OUR OBJECTIVE TO BE YOUR “GO TO” BUSINESS COACH
Our objective is to work with your company offering coaching or consulting services of the highest value based on a proven track record of “Hands-On-Performance”.
The key to the successful company is a business owner that spends more time and energy working ON the business, rather than IN it…
In order to grow your company, you need to spend more time on profit-generating activities, rather than meaningless tasks that just leave the wheels spinning in your business.
All professionals know this to be true, but the problem is they don’t know where to start.
There’s no doubt that you’ve heard of business coaching before – maybe you’ve even been coached yourself at some point in the past. But our business coaching is different…
- We don’t provide generic advice or solutions…
- It’s business coaching for owners and managers.
- We tailor our coaching to you building nightmares.
Meaning you don’t have to decipher through generic BS that doesn’t actually apply to your nightmare. Our proven coaching for your business is ready to deploy into your company immediately!
We’ve worked with hundreds of business across the United States. So you can rest assured that everything we offer has been tested by other businesses just like you and has been proven to work.
If you’re thinking that you’re already flat out with work and you just don’t have the time, you need this more than anyone.
It’s not about working longer hours.
Business coaching allows you to systemize your company so you can spend more of your time on profit-generating activities!
Now, we know what you’re thinking…
If you don’t increase your profits, you’ll be losing money with all those extra expenses…
But, here’s the thing.
Growth, unfortunately, is not linear.
In business, net profit follows what we call the S curve. Which means, in order to move forward, you’ll need to move slightly backward.
Think of it like changing gears in a race car – as you change gears, you lose a small piece of momentum, but you have to go through that to be able to take your speed to the next level.
It’s exactly the same in business!
We Guaranteed Our Coaching Results
: We Guarantee to get results, and that you’ll be able to “Find our Fee” in your business within 17-weeks of our coaching your company, or your coaching is FREE.
Our coaching programs have been tested and proven across America, so when you hire us, you WILL get results. Even if you have done your part in good faith, have done all assignments, and have attended all coaching sessions, events, and workshops–but you’re still not satisfied or not seeing the results you want by the seventeenth week, we will coach you FREE until you get the results, no questions asked!
: We Guarantee to tell the truth about you and your business no matter how uncomfortable it may be, or how hard it is to share with you the realities of your business and the changes you need to make. When you hire us, you will have the “unreasonable friend” and the personal business mentor you and your business need to succeed. You will be accountable for everything you say you will do, and your business will get the push it needs so you can get the results you want.
: We Guarantee you a “business re-education” about how your business really works and how to successfully grow your company, as well as how to apply your new education and knowledge to any business situation. Your coach will guide you with proven systems and strategies that will allow you to make more profit whether you need more time, a better team, and more money.
You’ll be in the “driver’s seat” of your own business equipped with a “map” and a “license” to take it wherever you want to go with us by your side unlocking the potential of your company.
: We Guarantee complete confidentiality. Our Coaching relationship with you will involve trust and understanding about the nature of our strategy and of your business. We guarantee the privacy of our work together.
: We Guarantee a personalized approach to your business. Your business is unique, and since you are relying on our vast industry business experience, we guarantee a full disclosure of the programs we recommend to you. We shall meet your expectations with the desired outcomes and results.
: We Guarantee to show you how we define business success, and how to build a commercial, profitable enterprise that works with or without you. Even if you are an owner who loves business and who loves working “in” your business every day. We will show you how to build a company you can work “on” whether you show up every day or not. Regardless of your ultimate goals, you will learn the strategies, systems, and advantages of our definition of a successful business.
If you want to learn more about our coaching contact us now.
Reitenbach-Kissinger Success Institute
LinkedIn Profile: https://www.linkedin.com/in/michael-kissinger-a66b214/