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How to avoid your business going bust

All over the world businesses run out of steam and go bust. If you are currently in business it is a good idea to learn from the companies who have gone bust and learn not to repeat their mistakes otherwise the same devastating result could happen to your business.

So what are the common mistakes businesses make?

  • Business stick to the same plan they created 3 years ago
  • Businesses stick to the same way of running their business that they used 3 years ago

In short businesses take their eye off the ball - they don't evolve and they end up turning into dinosaurs, big dumb animals.

If you have a business plan then good for you, if you haven't then maybe you should write one. Every business should have a plan and if you haven't got one - then be prepared to jopin the dinoasaurs. The other thing about your business plan is it shouldn't just be there to raise money - it should pave the way for you.

The fact is the world is constantly changing, it is evolving and if your business plan doesn't evolve with it then you won't have a business any longer.

For example years ago a customer might of complained on the phone to you and maybe you will have mishandled big worry that was just one customer. Unfortunately the customer can easily and freely broadcast any issues (rightly or wrongly) and give your company a bad reputation. In fact there are now whole industries of companies offering a service of creating a good reputation...most of these offer fake testimonials from facebook accounts and twitter etc. But the point is these companies exist whereas they didn't 10 years ago.

With the power of the internet it is now very easy for other companies to see what you are doing - copy the model and improve upon it. Bam! Your business is suddenly squeezed from the competition.

Customers have so much more scope with the internet - if you are selling a common item then you'll find the competition over-whelming, unless you can operate on the tightest margins then somebody else around the corner will always be there to under-cut you. If this is your type of business then you need to seriously re-consider.

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