Fewer than 50% of businesses survive beyond five years. Visit government census or Depart of Industry web sites and if you look at the detail you will see irrefutable evidence

The industry experts common reason for death is the unfortunate ones just ran out of cash. This lack of detail is of no value and so I decided to find those directly and indirectly connected with failed businesses to see if I could uncover the details, establish any consistent reasons for failure and present them on the web in the hope that my discoveries would help others avoid a similar fate. I discovered eight common reasons for business death. Here are three of them:

No Vision, mission or strategy

“If you haven’t a clue where you are headed then how are you going to get there?” You have to have a clear picture of what you want to achieve and how the environment will be for your business if you achieve it. To achieve anything you it is essential to have a strategy. Strategy is very similar to a road map it shows you how to get to your destination. It’s a structured list of actions. To make a strategy work you have to create a business plan that not only contains the key actions and milestones but can used to measure business performance against. A key tool for monitoring business perfomance is the sales forecast.

Lack of a system for marketing or sales

Marketing is about identifying markets and trying out strategies to position your proposition in the minds of prospects and moving them into your sales channel. Sales is about engaging the prospect and getting them to buy your product or service. Marketing is a process of measuring and improvement of the ways you employ to acquire prospects. Sales is the process of creating leads, forecasting sales and closing business. In successful companies a good marketing and sales system is often supported by a well designed sales forecasting software system. Systems like these enable you to track and measure the activity in the sales and marketing processes. Results arederived from reports created by the software which can then be used to compare what you predicted would happen versus the real outcomes. The point I am making is what gets measured gets improved or discontinued. This is the critical formula for success.

Lack a system to get sales from their captive customer list

There is a common phrase that eighty percent of your sales should come from twenty percent of your customers. Your focus is to achieve or exceed this number. Customers that have already bought from you are easier and more cost effective to sell to than prospects that haven’t. A combination of decent web based crm software and sales forecasting software will give you the information of historical activity and enable you to find opportunities in your current customer base.