Online Businesses Fail: Top 5 Reasons Why

Steven17 responsesGeneral

When you start any business failure will be a concern. With an online business this is even more worrisome. That is because so many people start online businesses only to see them fail. You do not want to be one of them. It is important to understand the top five reasons that businesses do fail so that you can avoid them as you begin yours.

online businesses fail

  1. Lack of knowledge: The sad truth is that many people start an online business with the hope of success and no real knowledge of what they are offering. If you go into a business based on something that you know nothing about then you have a much higher chance of failure. It is far better for you to focus your time and energy on an endeavor that you are familiar with and have expertise in. This will make you an authority and give your visitors confidence.
  2. Lack of passion: Running your own business often takes long hours and excessive work for very little pay in the beginning. Online businesses can take a little while to build and may drain you physically and mentally. If you love what you are doing then having this drain on you will not be an issue. If you lack that passion, then you will find it difficult to keep working at it while it is unsuccessful.
  3. Lack of Effort: Let’s face it, running a business is not easy. Beginning that business is even more difficult. It requires that you put in long hours and a lot of effort. If you get lazy and do not work like you should, the business will never succeed. You have to have the drive and ambition to see this project through. If you do not, there is no point in even trying to make it work.
  4. Lack of confidence: If you have expertise or abilities when it comes to your business then do not be afraid to showcase them. Many people lack confidence in their own decisions and choices. This makes running a business difficult. You should believe in yourself from the beginning and always know that what you have to offer is well worth what you are asking in return.
  5. Lack of persistence: Sadly, the most common reason that businesses fail is because the person creating them gave up. It is easy to do when you are working hard and not seeing any rewards. However, if you hold out and have faith you just may find that your business idea was a valid one. Give it ample time before you give up. The only thing you have lost is your effort and time.

If you know the reasons that businesses fail it will be simpler to avoid them. You can focus on what to do in order to succeed. This change of focus may be all that you need to be the business that did not fail before it got started.

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17 Comments

  1. Argie Monroy

    How about lack of spending budget? In the online business world, the right amount of spending budget is quite necessary as an online business owner will have to call for some expertise of several professionals in a particular field. It might not be that much seen, but lack of spending budget is definitely one of the factors for an online business to fail.

    1. I disagree with you. There are plenty of business’ types that you can launch online without spending more than $100. All you need is a domain and some shared hosting. If you start a business in a field you have experience about, you don’t need to call for some other people expertise, you can just do everything by yourself.

    2. Argie Monroy

      Well, that case would only apply for those who actually have experience with them. But how about those who don’t? I mean, who will do the promotion for you if in case you don’t know how to?

    3. The equation is simple: the barrier of entry to create an online business is financially very low, but you must be willing to do the work yourself. All the resources you need are available online, you just need to have enough motivation to learn.

  2. Mike

    I think that persistence is the most important thing, especially for a fledgeling business. The thing is that most people, when faced with adversity, will be all too willing to high-tail it and run. The people with a little more fight in them are going to be the ones who win out in the end, because they refuse to give in to setbacks; when they fall flat on their face they get right back up and keep going.

    1. Mitch

      This is so true. As my dad always told me “You’ve got to have gumption, kid. Balls of steel. People respect men with balls of steel.” haha!

  3. Affmaster

    What a great piece. I think this is brilliant, and very valuable information. It’s a sad thing to see a new business fail, I know that from experience. But really in the end it’s important to know that failing isn’t so much failing as it is learning.

  4. Michelle

    Loving these words of wisdom. It’s so hard learning from experience. You’re very kind to try to spread your knowledge to those who may be just learning, trying to keep them from learning the hard way. It’s very admirable. :)

    1. Anon

      Learning the hard way always sucks really bad. It’s much better to research and find sites like this that are run by someone who knows from experience than to jump headlong into something without knowing what you’re doing. That’s not going to end well 9 times out of 10.

    2. Michelle

      I agree with you on that. You have to have a clear vision, a clear path, and the motivation and drive to get you going!!

  5. Sarah

    I love the part about confidence! Not just for blogging though, that goes for anything and everything in life. Confidence is key to success, and not only that, but to your self-image. People can tell if you are confident or not, and they tend to prefer those who are. Feeling good about yourself is the first step to starting a successful business in my opinion.

    1. Chris

      I think that’s great advice. And definitely applicable to everything in life; doing everything with confidence is a sure way to be successful at whatever you do.

  6. Samie

    The saddest one is businesses that fail because of lack of effort. If anyone thinks that starting a business is easy they need to seriously get their priorities straight.

    1. Anon

      I can definitely be on your side about that. It’s sad the number of small businesses that don’t make it, and I try to support local and small businesses as much as I possibly can, but there are too many that are shut down for stupid reasons, like unpreparedness and not working hard enough. There a great book called The E-Myth which is about exactly that: why small businesses fail.

  7. Jony

    Great read! It definitely give you a lot to think about in regards to running your own show business-wise. I know that I personally could have used some of this advice a little earlier on in life.

  8. Ksingh

    Not having a social media plan is also responsible for businesses failing online.

    1. The more time I’m spending online, the more useless I am finding social media to be. Social Media takes a LOT of time and I’m not sure it’s the best use of small businesses’ time.

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