Who says you can’t succeed NOW? The long-held belief that 50% of businesses fail in the first year and 95% fail within the first five years has changed according to more recent statistics published by the Small Business Administration (SBA).
According to this report, 7 out of 10 new employer establishments survive at least 2 years and half at least 5 years. The Small Business survival rate has improved from 50% of businesses failing in their first year to 7 out of 10 (58%) of new businesses surviving at least two years, and 50% at least 5 years. Looking at this, especially since 2008, makes it all the more positive and hopeful for people starting businesses and succeeding, regardless of external conditions.
Scott Shane, Professor of Entrepreneurial Studies at Case Western Reserve University and author of nine books on entrepreneurship says:
“Failure rates are high because a large number of inexperienced entrepreneurs start businesses that shouldn’t be founded in industries that are unfavorable to new companies.”
Additionally, the SBA lists other reasons businesses fail including being under capitalized, not having a bankable and marketable product or service, sales strategy and marketing plan. These reasons have always been why businesses fail, but today it makes them fail much faster. Too much competition and more sophisticated technology and business tools are necessary to succeed.
I see way too many people who start businesses lose focus, give up and retreat way too early in their process. If I gave up every time I had moments of uncertainty or challenge, I would have been done 8 months into my 5 year business. I took those moments in stride and retreated to regroup then used them to surge forward.
You can’t succeed unless you:
- Have a solid product, service and plan.
- Continually review, revise and resume.
- Use all the current tools and resources.
- Work very hard and very smart.
- Renew your passion, purpose and mission continually.
Success in business is a process that meanders and unfolds – much like we evolve through our aging cycles.
Are you really committed?
If you don’t believe in and love what you do then do something else.
Are you relentlessly consistent?
Build great habits, systems, procedures and practice.
Personal Branding Lesson: Be More and Do More
Always be refining, learning and adopting new approaches and ways to grow your brand and branding. Today, we all have to own our development, advancement and success. It’s up to us to move our business in the direction we want it to go. Study and watch people who you admire and want to emulate. What are they doing? There are so many amazing businesses having great success today.
Here are the 10 Biggest Entrepreneurs of 2011. Take some time to meet them and learn about these inspired people and how they didn’t retreat, but surged forward to succeed.
Who says you can’t succeed now? Probably you. So maybe its time to have an honest conversation with yourself?
Warrior Concept Photo via Shutterstock
Good news, but I don’t understand how 7 out of 10 = 58%
I realize these stats are from 2009, so they aren’t really fresh (except by government standards), but I wonder how much of the better survival rate can be attributed to the economy? By this I mean if someone starts down the path of being an entrepreneur they might have more incentive to stick to it if they feel their chances of getting a ‘real job’ are greatly reduced because of the present economic climate. Probably nothing to this theory, but it is interesting to ponder.
Molly, I put a spin on 7 out of 10 is 58%!
Marshall, it is interesting to ponder and I do say probably a factor. I wanted to stick to the stats, as they reported them. Thanks for your comment.
I think this fantastic and I am excited for all of them.
Follow up the story on these companies in less than 3 years and here is what will have happened.
Right now they have a total of maybe 100-150 employees. Exactly what the economy needs.
In 3 years they will be bought out and all of those employees will be gone because the companies buying them will absorb the business without the need for the people.
This scenario is being repeated over and over and as you see most of the new start ups are tech in nature and require very few employees.
Read the book “The Last Will and Testament of Small Business” and you will get a lot od the answers of hwta to do about this.