9 out of 10 start ups fail! Yes, it is true only 1 goes the distance. There are various reasons that lead to the failure of a start up. Well, considering those can help you save yours! We have analyzed the biggest reasons why start ups fail. The reasons are as follows:-
No market need
The biggest mistake start ups make is to solve the problem that seems interesting. The approach should be of solving a problem that can serve the market. With the identification of a problem that can serve a market you have the gates open to capture it.
Various strategies must be used for identifying the market needs. In this market research is the key. The market research must be done in deep and the organization should make sure that all the statistics obtained are original. For the market research you can have different approach.
Not the right team
A good team can make an average idea success but a bad team can fail even with an excellent idea. The team of the start up is its strength. The right team adds in a lot of energy to the idea and always has a positive approach to a problem. On the other hand the wrong team can never have good coordination and a positive approach.
Team building is a very crucial aspect for a start up. The goal is achieved when the right responsibilities are assigned to the right people and then finally those right people coordinate. With this right coordination a right team is created. You need to ensure that they have the coordination and the team member accept each other. It is very important that the team members respect each other as well as their work.
Pricing cost issue
There can be issues with the pricing of the product/service. If you are a start up you need to make sure that you never come across this issue. Always it must be kept in mind that you have competitors and to compete with the giants you will have to compromise on some things in the beginning. Hence, never allow this issue to bring your start up down.
Loop Holes in the Business Model
The business model is the core of a start up. The base of a start up is its business model. With the help of a business model a start up implements its idea. It is great if you have a perfect business model which is a very difficult scenario. Many a times there will be loop holes in the business model. Identification of those loop holes is a very difficult job and after identifying those you need to find its solution.
In the solution as well you need to ensure that this time you are right and you are going according to the needs of the market.
A start up has various challenges to overcome. The competitors being the most difficult one, the start up need to cope up with every start up. Otherwise they can put the start up in danger. It needs to be aware of all the strategies being used by the start up. It includes the attractions given by the competitor to bring in more customers. Approximately the no of customers are fixed and the proportion in which they are distributed is being reflected by the dominating ones.
A start up also needs to stand still in front of the already established ones. For this something new and very interesting is needed. To compete with the giants the start ups need to have their service or product top class as well as make the customers feel special. The giant already gives pride to the customer with their brand name but the start ups don’t. They need to make sure that the customer feels the same with their product or service also. Not being able to doing so can lead to problems for the start up and thereby leading to failure!
Marketing is one thing which needs a lot of planning. Various strategies need to be included. Those include the traditional ones as well as digital marketing. It is very important to maintain a proper balance between those two. You also need to respect both the methods. The traditional method includes strategies such as cold calling, one to one interaction etc… For those you need to strategize and then reflect them with proper execution. Those are basically steps towards establishing your own brand.
For that you need to work from the root and make extra efforts and outperform the already established ones. With the digitization, digital marketing has also gained importance and now has become mandatory. For digital marketing also various strategies are being used. Those include the usage of all social media platforms. Right utilization of these platforms is very crucial. You need to keep your target audience updated with whatever you have and attract them towards you product or service.
Identification of the target audience is the most important aspect of increasing your sales. If you are not targeting the right audience it will be indeed very difficult to survive with the giants in the market. The identification of the customer base can be done with various strategies. The most important one is the product or the service whichever you offer. For example consider that you have a razor to sell and you are targeting the children. You need to ask yourself will the children buy the razor. The answer is no. You have identified the wrong target and it will make your survival impossible.
If your product or service is poor then it is the toughest task to survive in the market. Straight away you need to find out the bugs in your product or service. Bring this to research team. Bring reliable solutions implement those and repeat. This is the chain that must be followed to ensure the quality of the product or service is high. This can best be done with the customer feedback. And if the start up is not able to manage the quality of the product or service it is next to impossible to survive in the long run.
Lack of passion and motivation
Passion and motivation are two very powerful words that can make you do wonders. It genuinely pushes your limit and allows you to do that extra. When a start up lacks passion and motivation it becomes very difficult for it to grow. Even the survival at tough times becomes difficult and can result in the failure of the start up.