Small Businesses: Sinking Ships

Written by on May 9, 2013 in Career - No comments | Print this page

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As Americans, we like to think of ourselves as the original nation of entrepreneurs, and perhaps this is the reason why every schoolchild knows that half of small businesses are doomed to fail within the first year. Today, this is more true than ever. Only a small portion – 40 percent – of small companies are actually profitable, and 95 percent will fail within five years. Companies with fewer than 20 employees have a nine percent shot of surviving the market for 10 years or more.

Some of the nation’s most notoriously high risk endeavors are taken on surprisingly often by the nation’s entrepreneurs. In spite of high failure rates, retail stores, independent restaurants and direct sales operations are popular ideas among those looking to start a business.

Even more than restaurants, the retail business is a tough one. Such stores are likely to fail due to stiff competition; 80 percent of retail stores close before their fifth birthday. Unfortunately, most store owners can’t afford a space that sees high foot traffic – one of the most important aspects of opening a successful retail spot.

Source: The Most Tried and Failed Small Businesses

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