Money Minute - The Thing That Kills Business The Most

Andrew Chia, CENFIS correspondent
1.05pm GMT, 26 April 2023

The statistics for business success for startups is not really encouraging.  According to Forbes magazine, the failure rate is as high as 90%.

There are many things that can kill a business.  Amongst others:-

1.    Product or service problems

2.    Cash flow problems

3.    Inadequate market research

4.    Poor leadership

5.    Inability to adapt to change

6.    Partnership quarrels

7.    Worker problems

8.    Legal and regulatory issues

9.    Failure to innovate

10.   Competition

But a survey at CENFIS shows that the main culprit is competition.  It kills the most businesses.

The collapse of Tupperware - a household name for decades - shows that to be true.  An outdated model using the direct-selling system, coupled with products that are no longer fashionable, eventually affected sales and contributed to its downfall.

The stock chart shows a decline from roughly $100 to $0 in a span of ten years; almost similar to the chart for General Motors, the biggest corporation in the world, for decades too.

If you wish to start a business or invest in one, make sure your business is able to survive and defeat the competition.  It would have a better chance if it has a unique selling proposition or USP.  This means that the product is unique in some way so that there would be no competition.  And preferably, this differentiation is sustainable.  That would greatly increase your chances of success.

Learning message:  We should pay attention to the marketing department of a business to ensure success.