Top 10 Reasons That Businesses Fail


1. Management in Complete Denial

2. Failure to Adapt to a Changing Market3. Reliance on Critical Financing that Dries Up

4. Poorly Designed Business Model

5. Poor Internal Controls and Execution -- customer service, accounting controls, theft, fraud

6. Add New Products or Divisions that Drag Down the Profitable Ones

7. Failure to Prepare for Volatility of Uncontrollable Costs. For example, energy, materials, labor, or insurance.

8. Failure to Control the Controllable Costs. Businesses spend down the initial cash before it is flowing in at a positive rate.

9. Poor Capital Structure. Companies take on too much debt....Enough said!

10. Over-expansion. The need to get there first or to demonstrate revenue growth to anxious investors leads businesses to grow too fast.