90% of entrepreneurs fail in the startup phase. What are the causes? One study found the 7 most common. Do you want to become an entrepreneur? You will need to take into consideration these major hurdles to make sure that you are ready to get started in entrepreneurship.
1 – Sell products that do not meet the needs of the market
42% of startups think it’s best to solve interesting problems instead of looking for what the market really needs. Results? Failure. So, before embarking on entrepreneurship, it is essential to study the products to sell. The best way to do this is to answer the question: “What product will really meet the needs of the market?” ”
2 – Lack of financial management
Being the second major cause of failure, the lack of cash affects 29% of startups. In the startup phase, money might not be a problem for your business… but sometimes it is when financial management is not well done. In addition, the entrepreneur sometimes has to face unforeseen events against which he has not prepared. It is therefore advisable to anticipate them and insure your startup to protect it against certain occupational risks.
3 – Not the right team
To ensure business success, you need to create the right team. The professions must be divided into at least 3 types of profiles: the technician, the businessman and the financier. The company will need other providers over time. It is also recommended to remember that all members should be aware of the current situation of the company. They should then remember that the most important thing is not the amount of time spent on the job, but the quality.
4 – There is too much competition
This is an inevitable but manageable problem. A lot of startups underestimate the competition and start having problems. Success then consists of distinguishing oneself from others. How? ‘Or’ What? By answering the question: “What are the characteristics of my products that others do not have to solve a problem?” ”
5 – Problem with the sale price
Pricing isn’t always easy, especially for startup entrepreneurs. However, this is not a point to be overlooked. Not choosing the right price to offer leads the startup to defeat. To properly determine the price, it is advisable to take into account the variable costs (raw materials or finished products with partners, etc.) and the fixed costs (employees, rent, etc.). It is from this that you will know the profits you want to make.
6 – Product not interesting
To solve this problem, you need to know what your product is useful for. We must explicitly highlight the benefits it will bring to prospects. If you sell professional services, your best bet is to let your clients understand how your services will help their business in the most effective way possible.
7 – Lack of business model
Many startups believe they can be successful by building a large community first, rather than looking for ways to earn income early on. However, a business plan is very important to be able to monetize its services. For example, it allows you to create a balance between free services, which you offer to your prospects to convince them to use you, and paid services capable of generating income.