In business, success is never automatic. It primarily depends on the owner's foresight and organization. Even then, of course, there are no guarantees.

1. Bad Planning - No Planning
2. Inadequate capital and ignoring business and seasonal cycles.
3. Lack of focus, lack of commitment.
4. Lack of experience.
5. Poor records and useless financial reports.
6. Revenue problems - failure to identify a narrow customer base. Inadequate marketing to the target customers.
7. Too much capital tied up in equipment and inventory.
8. Too rigid or too lax an organization. Failure to delegate or conversely, ignoring need for leader ship and direction.
9. Location, location, location. Accessible to target market. Parking and expansion available?
10. Failure to communicate with accountant, banker or mentors until failure is certain.

In his book Small Business Management, Michael Ames gives the following reasons for small business failure:

1. Lack of experience
2. Insufficient capital (money)
3. Poor location
4. Poor inventory management
5. Over-investment in fixed assets
6. Poor credit arrangements
7. Personal use of business funds
8. Unexpected growth Gustav Berle adds two more reasons in The Do It Yourself Business Book:
9. Competition
10. Low sales

More Reasons Why Small Businesses Fail
These reasons aren't meant to scare you, but to prepare you for the rocky path ahead. Underestimating the difficulty of starting a business is one of the biggest obstacles entrepreneurs face. However, success can be yours if you are patient, willing to work hard, and take all the necessary steps.

On the Upside
It's true that there are many reasons not to start your own business. But for the right person, the advantages of business ownership far outweigh the risks.

• You will be your own boss.
• Hard work and long hours directly benefit you, rather than increasing profits for someone else.
• Earning and growth potential are far greater.
• A new venture is as exciting as it is risky.

Running a business provides endless challenge and opportunities for learning.