Nowadays, opening a new business sounds extremely attractive. The internet is filled with success stories. Who doesn’t know how Jack Dorsey or Mark Zuckerberg became billionaires from scratch? But there’s a side of the story the media sometimes skips.
According to statistics, more than 18% of new US businesses fail in the first year. And almost half of new businesses close within five years. Sometimes the reason is management. Other times, it’s bad planning and not enough work. It can even be a force majeure. Think about how many businesses failed due to Covid-19. Nobody could have seen that coming.
But there are ways to maximize your chances of success. One of them is to utilize the latest technology to help with business decisions. It’s no secret that a lot of business processes are done online. If you keep up to date with technology, you can provide a better service.
Let’s look at the three most common mistakes that could lead to business failure.
1. Lack of investment in cybersecurity
It’s hard to keep up with the rapidly developing technology. Online businesses search for senior developers to master their web pages. Marketing businesses continuously search for up-to-date analytics. And tech companies do what they do best – innovate. All of this can make your business stand out. Or drown it in competition.
However, cybersecurity is frequently overlooked. Small or medium business owners mistakenly consider they won’t become a target. Meanwhile, others try to minimize the costs because cybersecurity can get a bit expensive.
Saving money on cybersecurity can be devastating. The chance of becoming a victim of cyber threats increases without adequate encryption and antivirus software. The current situation is that hackers prioritize small and medium businesses because they lack sufficient cybersecurity protection. Moreover, 60% SMBs do not recover after a successful cyber attack. This makes it one of the most common mistakes that can shut a business down.
2. Failing to do market research
There are numerous benefits of running a successful business. But that also means there’s a lot of competition. Branching out in a new country or starting an online shop is risky without in-depth market analysis. Let’s assume you own a board game shop and would like to expand in France. It sounds like a good idea because board gaming in France is becoming more popular.
However, upon doing some research, you’ll learn that the board game market in France is saturated. Moreover, there are logistics issues that may stop your shipments in transit.
Tech-savvy business owners can use proxy services to access local market data. You can use proxies to navigate online data if you’re expanding to a new country or want to sell more at your location. They allow monitoring of online reviews. Also, they allow you to access local social networks (even if you’re based in a different location). Getting local SERP results will allow you to obtain data on potential customers in a new market. Most online businesses now use this technology to get ahead. And it’s hard to compete against them if you don’t.
3. Using outdated infrastructure
If you saw Hell’s Kitchen, you might’ve noticed that even restaurants suffer from outdated technology. Chefs can’t get their orders straight, and servers struggle with payments. There’s hardly a business that can run on old software nowadays.
Keeping up with technology will support your business in various ways. Firstly, your employees’ productivity will increase. And faster service will result in greater customer satisfaction.
New devices come with new software that has been appropriately secured. As we’ve discussed, cybersecurity issues may lead to an unfortunate shutdown. Moreover, Europe has implemented strict GDPR laws, so you must comply with sufficient data protection to even do business there.
Conclusion
New business owners must consider these three points. It’s always best to plan ahead instead of solving issues after they’ve already happened. Many businesses depend on the efficient use of technology. Not managing your technology correctly may lead you to an early shutdown.
