Its a nice article but its just that we read these kind of articles only after failing in business and there are mistakes that we do again and again.as much as your articles helps me to understand the common reasons for failure I would like to point out some major reasons in my own way:ġ) Lack of Capital- This is by far the most major reason for any business to fail although I am not saying this is the only reason. We know, but it’s also a continuous opportunity to avoid becoming one of the statistics. Being aware of common downfalls in business can help you proactively avoid them. It’s a clear roadmap that shows where you’ve been, where you are, and where you’re going next. Having a comprehensive and actionable strategy allows you to create engagement, alignment, and ownership within your organization. If you don’t know where you are going, you will never get there. As the saying goes, failing to plan is planning to fail. A common problem faced by successful companies is growing beyond management resources or skills. The cardinal rule of small business management is to know exactly where you stand at all times. Management of a business encompasses a number of activities: planning, organizing, controlling, directing and communicating. Sometimes it’s okay to say no to projects or business so you can focus on quality, not quantity. Going after all the business you can get drains your cash and actually reduces overall profitability. Not knowing when to say “No.” To serve your customers well, you have to focus on quality, delivery, follow-through, and follow-up.Are you in touch with them? Do you know what they like or dislike about you? Understanding your customer forwards and backwards can play a big role in the development of your strategy. Be aware of how customers influence your business. If your biggest customer walked out the door and never returned, would your organization be ok? If that answer is no, you might consider diversifying your customer base a strategic objective in your strategic plan. Staying innovative and aware will keep your business competitive. Failure to anticipate or react to competition, technology, or marketplace changes can lead a business into the danger zone. Cash is king, and many quickly find that borrowing money from lenders can be difficult. Running the bank accounts dry is responsible for a good portion of business failure. Businesses need cash flow to float them through the sales cycles and the natural ebb and flow of business. Does your market connect with what you are saying? What is the value I am providing to my customer? Once you understand it, ask yourself if you are communicating it effectively. You must clearly define your value proposition. Failure to understand and communicate what you are selling.It takes more than a good idea and passion to stay in business. We all learned the dot-com lesson – to survive, you must have positive cash flow. It’s important to choose an industry where you can achieve sustained growth. Sometimes, even the best ideas can’t be turned into a high-profit business. Opening a business in an industry that isn’t profitable.Answering questions about who your customers are and how much they’re willing to spend is a huge step in putting your best foot forward. In short, it’s vital to understand your competitive marketspace and your customers’ buying habits. We often ask our clients, “Where will you play and how will you win?”. Failure to understand your market and customers.With this information as a backdrop, we’ve put together a list of 10 common reasons businesses close their doors: