Avoid These 3 Mistakes That Could Destroy Your Business

According to the Bureau of Labor Statistics, about two-thirds of businesses with employees survive at least 2 years and about half survive at least 5 years. As one would expect, after the first few relatively volatile years, survival rates flatten out.

While the health of an economy plays a great role in the survival of businesses, the activities of business owners also take a big quota. In other words, whether a business will survive or not depends on the overall structuring and positioning of business by entrepreneurs.

A business might have brilliant goals and objectives as well as great value proposition, but it might still nose-dive if it fails to put certain things in place.

The following are costly mistakes every business must avoid by all means. They can ruin any business in spite of years of investment, hard work and commitment.

Lack of security

The need to secure your business from eventualities can never be over-emphasized. By security, I mean the protection of company properties such as documents, patent right, brand image etc., from damage or theft.

One of the snags of technology right now is the increasing rate at which identity theft occurs. Identity theft manifests through stolen credit card details, email sign-in information, medical records and social security information. Issues like these can be prevented through the use of alphanumeric passwords, concealing your credit card details and having a backup for all data.

For companies that handle a great amount of data, using a hybrid cloud security solution will help to protect applications and data from critical new threats, like ransomware, that can cause significant business disruptions, while helping to accelerate regulatory compliance.

Cash flow mismanagement

Cash flow management is one of the most tenacious tasks in every business organization. Cash flow is the net amount of cash and cash-equivalents moving into and out of a business. It is a business metric that helps to determine the financial health of any business.

However, most businesses are not leveraging cash flow effectively. According to a U.S. Bank study, a whopping 82% of businesses that fail do so because of cash flow problems.

Cash flow isn't just the amount of monies that are moving in and out of a business. For cash flow to be effective, you have to consider timing too. For example, you might end up having cash flow problems if your invoices are delayed until after your loan payments are due.

Poor branding and marketing

Show me a business without a brand and I’ll show you a business that’s heading for the rocks. Building a business brand is not only a necessity; it’s also an obligation for every without which businesses cannot survive.

Businesses need to develop unique brand identities that would differentiate them from other businesses. This helps their customers to quickly identify their core values thus giving them an edge over their competitors.

Big brands such as Coca Cola, IBM, and Toyota have always been relevant because their unique brand concepts have made them household names. The bottom line is that any business without a brand will never grow.