Royalx
Graphic created by Performance Card Service.
The odds are stacked against entrepreneurs from the very beginning. Taking a look at the numbers shows that only about half of new businesses survive for five years, and only one-third of them make it to a full decade. There are plenty of reasons for this that are outside of your control, including intense competition, lack of available capital at the beginning and shifts in the marketplace. However, a large number of new enterprises fail because they were blindsided by risks they weren’t prepared to face. It’s impossible to be ready for a situation you’re not aware of, which is why anyone looking to start a new venture needs to know what to expect.
Know the Risks
Too many startups plan for what they want to happen, and not what actually could happen. The ambition and optimism that drive many people to start their own businesses are essential, but they have an unfortunate tendency to create blind spots. For example, one of the most common pitfalls that befall many new ventures is overestimating the need for whatever product or service they offer.
Even if you’re excited about what you’re delivering, that doesn’t mean your potential customers will be. That’s why it’s critical to do extensive market research before you launch. Understanding the level of demand for your offerings will help you avoid being seriously disappointed once you open up shop.
Another problem that many new businesses encounter needlessly is finding out too late that they don’t have enough cash on hand for emergencies. Planning only for the good times means you will be caught flat-footed when the unexpected occurs. Even though no one wants to acknowledge that setbacks are inevitable, setting up an emergency fund to cover them is a crucial step to take.
Most businesses need to accept credit card payments to collect revenue. However, this is easier said than done. Having the wrong credit card processing services provider can be a tremendous problem for many new companies, but many don’t stop to consider this until it’s too late. Finding a processor than understands your business and its needs intimately can make transactions go much more smoothly for you.
Even if your new enterprise isn’t strictly an eCommerce operation, the realities of the modern business landscape meanyou’ll need to utilize ITin some fashion. Unfortunately, many entrepreneurs underestimate the threat of cybercrime. The losses suffered as a result of data breaches, ransomware and phishing schemes can be too much for many young companies. This is why having a strong security system in place for your IT is invaluable.
Forewarned Is Forearmed
Starting up a new business can be an extremely rewarding and exciting process. However, don’t let the thrill of becoming your own boss distract you from the dangers you may encounter along the way. If you don’t want to become one of the countless failures that have come before you, take the time to prepare for the worst as well as the best. For more information, take a look at the accompanying resource.
Author bio: Matt Wollersheim is VP of Sales at Performance Card Service, a high-risk merchant account provider. Wollersheim has been on the executive team since 2005. His focus is on general marketing, client relations and development of new processing channels.
