Why do Small Businesses Fail: Top 10 Reasons and Best 50 Solutions

Why do Small Businesses Fail: Top 10 Reasons and Best 50 Solutions

Why do small businesses fail?

 

The sad truth is that most small businesses will fail.

In most countries (including the US and UK), more than half of newly created enterprises fail within the first five years (business failure statistics according to OECD Entrepreneurship at a Glance Report 2016 and Eurostat).

 

EU Business Survival Rate

One, three and five-year survival rates of enterprises in EU (2014) © Eurostat

 

New business failure rates are high.

Small businesses around the world are failing for the same set of reasons, even as you read this article.

We think you’ll agree: that sounds pretty frightening for every (soon-to-be) entrepreneur.

 

Or does it?

 

Well, as it turns out, knowing the major small business failure reasons in advance, or at least sufficiently early, can be life-changing.

 

This in fact can save your new business from failure.

 

And this is exactly the rationale behind this comprehensive article.

 

Here, we outline 10 major small business failure reasons, and provide 50 actionable solutions against potential failure.

 

And the best part?

 

Most of them are ready to implement, starting now!

 

Ready?

 

So, what are the primary causes of business failure and what can you do about them?

 

Let’s dive straight in.

 

Sections:

 

  1. Low Sales
  2. Lack of Experience
  3. Insufficient Capital
  4. Poor Location
  5. Poor Inventory Management
  6. Over-Investment in Fixed Assets
  7. Poor Credit Arrangement Management
  8. Personal Use of Business Funds
  9. Unexpected Growth
  10. Competition

1. Low Sales

 

This is a catch-all for many small business failures.

So what’s the problem?

Pretty straightforward: low sales is probably the shortest way to business failure.

Obviously, there are some reasons behind low sales volume.

Sometimes this can be a poor marketing strategy, not enough spent on advertising, a complicated process for customers to purchase the product, low production rate, and so on.

One of the classic reasons for low sales is not enough funds being allocated to marketing. Too many businesses fail to put sufficient funds to adequately promote their products or services.

Needless to say, to avoid issues of low sales all aspects of marketing and manufacturing will have to be considered.

 

Solution 1.1: Proper planning =  Higher chances.

 

Let’s be honest, most of the sucesfful businesses are built on meticulous planning. Very seldom spontaneous projects turn to profitable businesses.

You’ve probably heard the advice a million times, but proper planning is indeed critical.

This perfectly applies to your sales.

Before acquiring the loan to start your business, it is important to predict the necessary amount of sales needed to sustain the company once the loan becomes due.

A similar planning is also required when you start a business with your own money.

When the projection is made, it is important to tailor everything else to match it (your expected burn rate, marketing, finances, etc.).

Although it is impossible to predict the exact sales volume, it is still wise to be prepared for the worst scenario.

 

Solution 1.2: Reinforce your sales & marketing techniques.

 

Here’s the point:

Attracting enough sales depends on how you are marketing the product or service.

Successful businesses constantly seek to run their marketing at full speed and convert as many leads as possible, often at an increasing pace.

Business milieu rarely forgives any slack. You probably won’t survive if you fall behind.

Yes, it maybe a little sad.

But it’s true.

 

So do not lag behind!

 

Rethink your sales & marketing. Clear them up of all garbage.

Unnecessary stuff slows you down while you barely notice this.

Try to identify the weakest parts of your marketing & sales process, which are holding you back and providing none or very limited results.

Once you know what they are, immediately get rid of them.

You may later substitute those parts with entirely new practices, methods, tactics, and strategies.

 

The whole idea here is to:

1. clear things up;

2. keep testing with existing and new material;

3. leave only those things that bring tangiable results;

4. Repeat 2 and 3.

 

Pro tip: Never stop testing. Try to beat your best methods, tactics, and strategies with the new even more effective ones.

 

 

Solution 1.3: Get maximum sales on each customer (probability of sale as high as 70%!).

 

Here’s the thing.

You probably already know that a new customer costs significantly more than existing customers.

Acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one.

At the same time, according to Marketing Metrics there is only a 5-20% probability of selling to a new prospect, while chances of selling to an existing customer are between 60-70%.

 

Your existing customers are at least 3 time more likely to buy from you.

 

%

New Customer

%

Existing Customer

 

All you have to do is to take this chance.

We recommend starting with upselling and cross-selling to see if they work for you.

To get off the ground, you can check how other businesses are already using upsell/cross-sell to increase their revenue.

Not grabbing the chance to sell more to your existing customers is missing an opportunity.

 

And opportunities shouldn’t be missed.

 

Remember: lost opportunity harms your business and contributes to failure.

So, it’s important to tap into every opportunity that your existing customer base provides you.

If you already have a client database in place, why not use it to increase sales?

Here are some tips to help you leverage customer data.

 

Solution 1.4: Effective Pricing.

 

Underpricing?

 

Overpricing?

 

Those are questions that haunt many entrepreneurs.

 

Picture this:

The influence of pricing strategy on sales volume is tremendous.

 

Before we go any further, just check this out:

 

 

Impressive?

You bet it is!

 

Pricing is art. Pricing is science.

Right pricing is hard.

 

But one thing’s for sure:

Pricing always deserves a focused approach.

 

The right pricing strategy can enhance sales volumes, laying the foundation for a business that will prosper.

Get it wrong, and you may end up with problems that will drag down everything you’ve built.

So, it’s probably a good idea to review your pricing strategy.

Try out different pricing methods and techniques that are available to you.

Stick to what brings you more profit.

 

Read these articles on pricing and pricing psychology for further guidance:

 

Solution 1.5: Do not squeeze your marketing budget, unnecessarily.

 

Marketing is something everyone wants, but no one wants to pay for.

The key is to approach this issue in a slightly smarter way. Understand this, slashing your marketing budget without good reason means cutting off opportunities.

 

Unnecessary cuts of the marketing budget means cutting off the opportunities. Click To Tweet

 

 

Which is not to say that rationalizing a budget isn’t a good idea. But it’s not the marketing budget that should be cut, it is individual toxic marketing elements that must be out of it.

Those are two entirely different concepts.

 

Solution 1.6: Collect customer feedback and use it to increase sales.

 

This cannot be over-emphasized, since customer feedback is globally accepted as critical for business.

Customer feedback can help you in many ways by providing actionable insights to create a better customer experience. Tangible data from customers can be used to make better business decisions.

If utilized effectively, customer feedback will help increase sales.

Consider this, for a second:

 

  • Dissatisfied customers 4%
  • Customers who do not voice complaints 96%
  • Customers who will never come back 91%

 

Customer feedback is essential.

The constant dialogue with people for whom you have designed all you efforts looks just natural.

If you do not know where to start, try the five easy ways of collecting customer feedback from Salesforce and see how you can increase your sales with the newly acquired data.

 

Solution 1.7: Overdeliver.

 

Overdelivering is a part of the more general concept of exceeding customer expectations.

This is a powerful way of stable sales growth and is backed by human psychology (“happiness = reality – expectations” principle).

 

Happiness = reality – expectations Click To Tweet

 

An incredible experiment has been done on this by Elliot Aronson (University of Minnesota) and is available here if you want to explore this phenomenon further.

 

One thing is pretty clear: people (a.k.a. customers) like it when you exceed their expectations.

 

People (aka customers) like when you exceed their expectations. Click To Tweet

 

This works, and many businesses have successfully proved it. So, when your sales are floundering, try overdelivering.

Here is an excellent guide by Shopify on this topic. Start implementing it right away.

2. Lack of Experience

 

This is a generalization of sorts, but not having the experience of managing the grind of a small business is one of the primary reasons for failure.

Those who have the relevant experience usually understand the daily challenges that a small business faces. More importantly, they are more likely to spot potential trouble in time to make course corrections.

Of the small businesses that succeed, many are run by people with previous business experience (including failed business attempts), whether it was their own venture or assisting someone else with a startup.

 

What it means is this:

The more business experience you have, especially with running the daily operations, the more likely you are to succeed.

 

Which is not to say that you can’t hit the bullseye with your first try.

 

Well, that’s fair enough, but…

 

What specific options are available, for you to start and run a business with no prior experience?

 

Let’s take a closer look.

 

 

Solution 2.1: The easy way – start a business in a field that you already know.

 

This is a no-brainer.

The good business idea is not always something red-hot. So, do not torture yourself trying to come up with a revolutionary business idea.

There are always some business opportunities out there in almost every field (including yours). Most of them are pretty straightforward and time-tested.

You might just pick the one that looks most promising and closely related to your unique experience.

The next step would usually be validating the idea, and once that is done you are ready to initiate the process of setting up your business.

Starting your new business in a field that you are already well versed in will provide you with a nice starting boost and probably a valuable competitive advantage.

If you want to make your life easier and the probability of failure lower, then it is an excellent idea to start a business that suits your expertise.

 

 

Tip:

In case you can’t find a business idea that appropriately matches your experience you can try asking yourself the following simple questions to find one:

  • What is my biggest knowledge that makes me different from others?
  • What skills I have developed that no one or very few people can have?
  • What other experience I have that no one else have?
  • Can I use those experiences to build something special for other people?

 

This may seem elementary at first glance, but it is a powerful technique to understand your unique experiences and discover specific business opportunities that are open to you.

 

Pro tip: Used in conjunction with our Business Idea Ranking Table, this strategy can bring you fantastic results.

(For full guidance on how to use the Business Idea Ranking Table read our Ultimate Guide on How To Start a Business)

 

 

Solution 2.2: Learn as much as possible.

 

If you have already started a business or decided to go with a business idea in an industry that you have no previous experience of, then the best solution might be to study things and learn as you go.

Educate yourself as much as possible. Education has a positive correlation with business success rates.

 

Education has a positive correlation with business success rates. Click To Tweet

 

Research all ins and outs of your particular business field and the industry it’s part of.

Meet as many people as you can and read/listen as much as you can about the industry to have a broad understanding of the field and get up to speed quickly.

Apart from industry-specific insight, you also need general business knowledge to compensate for the lack of experience.

As a quick yet effective solution, we recommend reading the Personal MBA by Josh Kaufman.

 

 

Solution 2.3: Find a mentor.

 

A good mentor is an invaluable asset in business. Even the most successful entrepreneurs have had a mentor.

You might do as well.

Try to find a mentor for free on SCORE (US) or Mentorsme (UK). Alternatively, contact your local small business organizations for mentoring if your business is located elsewhere.

 

SCORE - Free Small Business Advice

SCORE is a non-profit organization dedicated to helping small businesses through education and mentorship.

.

3. Insufficient Capital

 

Believe it or not, but…

Perhaps the most common mistake that people make when starting up their small business is not having enough money on hand.

All too often, the money used to start the business does not last long enough for the company to make any profit.

This is particularly true when a large loan is used to get the business started.

With no/poor business planning/management it’s easy to run out of cash before the business starts bringing in enough revenue to keep it alive.

When a business runs out of cash, it rarely survives.

 

Solution 3.1: Get at least 25% plus capital before you start.

 

Every small business/startup ought to have sufficient capital to get the business through the first six months, and often longer, depending on the overheads that need to be paid.

So, calculate how much you will need to pay over six months (or a year) and add extra 25% for unexpected expenses.

More is better here. Cash is the lifeblood of business.

 

Cash is a lifeblood of business. Click To Tweet

 

 

The larger the capital you have available, the more time your business will have to prove itself and start generating revenue.

 

Solution 3.2: Understand your finances.

 

Seriously, do it now.

If you have already started your business, the sooner you understand your finances the better your off business will be.

Along with sufficient start-up capital, it’s pretty important to know what you are doing.

Depending upon your approach, your capital may drain away quickly or last longer.

Master this part, starting today.

Reading the Personal MBA by Josh Kaufman, the business book we have mentioned above should be a good way to start. The book has a chapter dedicated to Finance, which outlines the finance fundamentals quite comprehensively. You can just start right away with that.

Understanding the basics of finance before you actually start a business is essential.

It’s often not too late to catch up when you already have an operating business and it has not failed yet.

 

It is material to understand the basics of finance before you start a business. Click To Tweet

 

 

Solution 3.3: Watch your burn rate.

 

To get the most out of your available capital, it’s important to watch your burn rate.

Reliable and right accounting helps to effectively manage your finances and directly influences your use of funds.

The key is to reach a balanced rate of spending, according to a research paper titled Startup Survival and a Balanced ‘Burn Rate, co-authored by Wharton marketing professor Ron Berman and Pablo Hernandez.

To dig even deeper and get your burn rate balanced we recommend reading this.

 

Solution 3.4: Establish reliable accounting (bookkeeping) system.

 

Reliable and right accounting helps to effectively manage your finances and directly influences the usage of your funds.

No doubt about it.

Handling the accounting (bookkeeping) on your own (even for the first few months) might look like a great cost-saving idea, but it rarely is.

We believe that accounting (bookkeeping) can properly be managed only by professional accountants/bookkeepers.

Depending on your circumstances, you might hire an in-house accountant or outsource this. The point is, the accounting part of business needs to be consciously delegated.

With professionally managed accounting (bookkeeping), in the long run you’ll save time and money, and prevent ulcers.

Even more, you’ll make sure that finances flow in and out in a structured and transparent manner.

This is absolutely vital to help you make the right decisions.

For even more flawless accounting you can use accounting software.

Below are some, check them out:

Wave
Quickbooks
Xero
Freshbooks

 

Solution 3.5: Avoid bad and unfamiliar financial mechanisms.

 

Financial mechanisms look attractive. They lure business owners and seem to be a good option to solve any capital related troubles.

However, not all of them are innocuous.

Any money that has been provided in the form of a loan inevitably turns to debt.

The debt coupled with disadvantageous conditions may easily lead to disaster.

Bad and/or poorly arranged financial mechanisms must be avoided by all means.

The best solution is to refrain from the use of any financial mechanism unless you are 100% sure of what you are letting yourself in for.

 

4. Poor Location

 

Let’s face it.

Although this is not about all types of business, location is often something that makes or breaks your business.

 

Location is often something that makes or breaks your business. Click To Tweet

 

 

It’s all about the location, especially when your business caters to local customers.

You may have noticed that the good locations cost considerably more than out-of-the-way areas in your community.

This requires careful research on your part when it comes to choosing the right place for your business.

Prime real estate is expensive as it’s a key driver of foot traffic and sales.

If you have already chosen a not-so-good location or simply can’t afford a good one, then try to compensate for this weakness by adopting appropriate actions.

 

Solution 4.1: Choose the right location from the outset.

 

When choosing the location for your new business pay attention to the following factors:

  • Rental Cost
  • Foot Traffic
  • Convenience
  • Crime Rate in Neighborhood
  • Target Consumer

 

You need to be where your best customers can find you.

This means having an easily accessible location even during rush hour.

Plus, an area that generates a good amount of foot traffic and is considered safe by the public.

Falling in love with a particular place is easy. But do not get fooled by your emotions.

Ignoring the real world may lead to subsequent financial loss.

To avoid this scenario, we suggest using the simple ranking table.

People often overlook the power of ranking tables, whereas they are highly reliable bias filters. 🙂

Below is the very basic ranking table that you can use for the purpose of finding the best available location for your business:

 

Business Location Ranking Table

 

While using the table, it is mandatory to base your numbers on hard facts only.

Ignore your unfounded inner voice/opinion.

The solid facts and numbers are real.

Anything else that has no reasonable grounds is often just plain illusion.

Illusions do not interact with the real world.

 

Pro tip: To achieve the best results you can slightly modify the ranking table by including additional industry-specific criteria and/or sub-criteria.

 

 

Solution 4.2: Go online.

 

In a modern world online by default means great location. Having an awesome website/online presence in addition to your physical location is a beautiful thing.

 

Awesome online presence in addition to your physical business location is a beautiful thing. Click To Tweet

 

 

With each coming year, online matters more than anything that mattered before.

If your business suffers from poor location, going online can save you from probable failure.

Try to compensate (or complement) the drawbacks of your location with available online opportunities.

 

Want to know the best part?

According to a survey by Clutch, nearly half of small businesses in the US do not have a website!

Another research by Godaddy & Redshift Research shows that in Australia, Brazil, Canada, India, Turkey, United Kingdom, and United States 59% of small businesses don’t have a website. We assume that this number is somewhat equal or even higher in other countries.

Obviously, small businesses around the world aren’t fully utilizing the internet.

 

 Survey question: Does your company have a website?

  • Yes, since 2014 or earlier 41%
  • Yes, since 2015 13%
  • No, but plan to in 2016 17%
  • No, but likely in 2017 or later 7%
  • No, unlikely in future 12%
  • No, neither likely nor unlikely in future 10%

Data source: Clutch

Some of the respondents are your competitors.

Needless to say, even a basic website means a quick win over at least part of your competition.

The best thing you can do today is to create a website (if you still do not have one). The rest will follow.

Just make sure that you constantly keep working on your website/online presence and that you devote the time, effort and budget for this to start bringing results.

 

Solution 4.3: Maximize your signage.

 

According to International Sign Association – Your sign is your voice on the street.

Just imagine:

The powerful marketing tool working for you 24 hours a day, 7 days a week, 365 days a year.

 

Did you know that…

Only 1% of first-time customers come in because of your TV ad and 50% come in because of your sign?

 First-time customers coming in because of:

 

 

%

Sign

%

Word of mouth

%

Newspaper, Yellow Pages & Radio

%

TV ad

 

The number of exposures that a good signage can bring is insane.

What we also like about the signage is the durability. A one-time investment made in a proper signage that requires no further effort from your side can deliver years of non-stop marketing.

Do not underestimate the power of signage. Get the most out of it.

 

 

Create your signage based on the following:

  1. Compelling color
  2. Contrast for readability
  3. Size

 

 

For further guidance on signage and its economic value, see ISA and a handbook on how on-premise signs help small businesses tap into a hidden profit center by New York Small Business Development Center.

 

Solution 4.4: Understand if your location is indeed bad.

 

Sometimes, when your business is not performing well enough, you might see the location as the number one reason.

However, this might be a hasty conclusion.

Before making this kind of verdict, reanalyze your business performance.

First, try to push harder with your marketing channels and other available options to improve the business results.

Try to clear things up and see if your location is actually what is holding you back.

Nine times out of ten you will realize that there are untapped opportunities that you did not use previously.

It’s helpful to get customer feedback while running your marketing at full speed. Survey your existing clients to get to know what they think about your location.

In case it becomes apparent that your business location is doubtlessly wrong and there is nothing you can do about it – move to the Solution 4.5.

 

Solution 4.5: Change your location.

 

Sometimes, the business location is chosen so badly that spending extra energy on it makes no sense. So, if none of the methods listed above improve your business results – change your location.

Do not throw good money after bad, and do avoid a widespread escalation of commitment pattern.

5. Poor Inventory Management

 

Let us be brutally frank:

Too many businesses either overstock on products that do not sell or do not have the products that are selling.

The good news is, thanks to new methods of inventory management, you can significantly improve your systems and keep track of what you sell virtually in real time.

So let’s get down to it.

 

Solution 5.1: Set up your inventory tracking system at the outsetfrom the start, and check it daily to see what is moving and what isn’t.

 

By taking a few minutes out of your day to keep track of the inventory, you can increase your sales and stop wasting money on stocking items that sit on the shelves.

The successful businesses take inventory management seriously.

A properly set up and regularly monitored inventory management system positively influences the business.

Being systematic is important to ensure that the process is uninterrupted and under constant control.

 

Solution 5.2: Test and improve.

 

Even if you have some inventory management system in place, it’s still a requirement to maximize its efficiency by researching and testing new methods continually.

Some approaches may seem good at first glance, but they won’t necessarily work for you.

So, you basically need to try things out to see how they work for your business.

Find something that seems a likely fit, stick to it and keep improving it on a constant basis.

Once it has proved to be successful, try to automate the whole inventory management process.

To start, you can check these 3 popular inventory management techniques explained by Fishbowl:

 

 

…and this infographic from Tradegecko:

 

Inventory Management Techniques

 

Solution 5.3: Automate.

 

Once the successful systems have been created, try to automate them as much as possible.

This will provide you with many added benefits including speed, real-time analytics, low costs and fewer manual errors.

Automation can be successfully achieved with inventory management software, so let’s move to the next solution.

 

Solution 5.4: Use inventory management software.

 

Consider using inventory management software for automation, higher performance and faster growth.

If chosen carefully and correctly, good inventory management software can help you in many different ways including saving time, selling more and providing better control over the whole process.

There are many online inventory management solutions out there. Choosing the right one is again a matter of testing.

To start, you can check these online solutions to see if they work for you:

Tradegecko
Unleashed
Megaventory

Solution 5.5: Hire inventory control personnel.

 

If your business is too dependent on inventory management, then it can be a good idea to experiment with hiring specialized inventory control personnel.

This might look like an unnecessary cost at first glance, but investing in your inventory management team may prove itself in the long run.

 

Solution 5.6: Make inventory checks more frequent.

 

When you experience difficulties with inventory management, then it makes sense to make inventory checks more frequent.

This will help you to anticipate and detect problems faster and cure them accordingly.

6. Over-Investment in Fixed Assets

 

By investing too much in fixed assets, you lack the flexibility to make the necessary changes as your company grows.

Fixed assets need to be rigorously researched in terms of what is necessary to invest in and not spend anything more so that you do not overcommit.

There are many aspects of running a business that require having the funds available to make necessary changes. Putting too much into fixed assets compromises your control over your finances and exposes you to greater risk.

 

Solution 6.1: Understand your objectives.

 

Investment in fixed assets should be laser focused on your business goals.

Unnecessary purchases are not something that a truly promising business should tolerate.

Invest in a fixed asset only after you fully understand your objectives.

Make sure you have this matter covered in your business plan (this involves an in-depth research on the topic before you make the actual investment).

 

Solution 6.2: Get (expert) advice.

 

Refer this question to your business mentor if you have one, or alternatively try to speak to someone with practical industry experience.

In the real business world, lots of things cannot reasonably be foreseen or predicted before you actually dive in.

That is where people with relevant experience can help. They can provide you with helpful insights on industry-specific fixed assets.

It’s very easy and typical for a small business to fail for this reason. Thus, the external point of view on fixed assets is often critical for building a successful business. If done right this will save you from failure or at least mitigate the business failure risks.

Generally, the value of unbiased business advice is often discounted by business owners.

It’s a fact that you never know what kind of information you’ll get from others until you go and ask them.

Just take this as some sort of competitive advantage.

Go and ask what people know and think. Then simply use the information you get for the benefit of your business.

 

Pro tip: Filter any information you get from people, including your highly-trusted sources. Always distil the information through your innate common sense, intelligence, knowledge, and personal experience.

The business and industry knowledge that you’ve possibly managed to acquire already comes to your help here.

If have no proper or prior knowledge, then refer to the solutions provided in the first section of this article (Lack of Experience).

 

Pro tip 2: Do not limit your sources only to people you know in real life. Leverage the power of online communities. Ask questions on Reddit and Quora and get to know what a broader audience thinks.

 

Remember to be highly specific to get the useful feedback.

Include as many details as possible in your questions. Broad messages are likely to bring similarly vague and general comments that are usually not helpful.

 

Solution 6.3: Invest in innovative and latter-day assets.

 

Fixed assets can be different.

Time flies, and often the best thing that was out there a month ago, can be already outdated today.

So, try to come up with the most up-to-date, long-lasting, efficient and flexible fixed assets. Along with cost also look for durability, quality, liquidity and other relevant factors. Invest some extra resources now (such as more research and time) to realize long-term benefits.

Consider different alternatives and try to pick the best.

Every right decision you take today keeps saving you pennies in the long run.

The small things tend to accumulate over time.

So, this usually translates into higher winnings with the passage of time.

 

Small things tend to accumulate over time. Click To Tweet

 

Solution 6.4: Invest in liquid fixed assets.

 

You must admit the probability of things going wrong.

At some point, you might want to sell your fixed assets for any reason.

So, it makes sense to invest in the most liquid assets that are available on the market at the time of purchase.

This will make your life a lot easier if something goes wrong, and it can help to redeem your business from potential failure.

 

Solution 6.5: Stick to your business plan

 

A clear-cut business plan shall cover the fixed assets part.

If you don’t have a business plan, then read our article on How to Start a Business to write a good one.

Once you have a reliable business plan make sure you actually stick to it.

This will help you to stay within the reasonably defined investment limits.

7. Poor Credit Arrangement Management

 

This can manifest itself in different ways from not qualifying for additional loans, mismanaging funds, or failing to see the higher interest rate associated with poor credit.

For those who are starting up a small business and taking out loans, the interest rate will often be based on credit rating.

A single percentage point adds up to hundreds, if not thousands of dollars in extra expenses that do not go towards helping your business get off the ground.

The credit rating is the backbone of your loan acquisition efforts. It needs to be as strong as possible so that you can get the best interest rates. It helps if you can raise money from other sources to keep your borrowing down to a minimum.

In any event, the arrangement management you apply to your credit will play a significant role in the success of your small business efforts.

 

Solution 7.1: Do not handle credit arrangement on your own.

 

If you are not a financial professional then handling your credit arrangements on your own is not the best idea.

Credit mechanisms can be different and they are often hard to understand or manage.

Therefore, it’s highly recommended to seek advice from an external financial advisor or your mentor before taking any loans.

 

Solution 7.2: Try to avoid credit where possible.

 

Although credit gives you a nice boost, you still have to repay the money.

If you are not sure that you will effectively use the instant access to an increased purchasing power that credit entails, simply do not take it.

Don’t arrange any credit that you do not really need.

Even too much funding can harm your business.

Nine times out of ten you need less money to start your business than you might think.

Don’t make the mistake of borrowing money to fuel your business for the next five or ten years – usually you only really need enough money to make progress this year (plus 25% for unexpected expenses).

In other words, avoid credit where possible!

Building a business without getting involved in any sort of credit may take more time and effort, but running a self-sufficient business that does not need to pay anything out is a beautiful thing.

 

Self-sufficient business that does not need to pay anything out is a beautiful thing Click To Tweet

 

Solution 7.3: Consider other available financial mechanisms/tools.

 

Although the small business loan is probably the safest way of funding your business, there are still a few other financial mechanisms that might work even better.

In case you reasonably need extra capital don’t immediately go for a standard loan. Instead, research the other available funding options and go with something that matches your situation the best.

8. Personal Use of Business Funds

 

Admit it.

Too many business owners are tempted to take money out of their business accounts and spend them for their own use.

Given that the failure rate for small businesses is tied directly to how they spend their money, any of it that goes for personal use is taking away from the bottom line.

Tight management of the funds is crucial, especially in the first year of business. Therefore, there should not be any funds diverted for personal use during this critical time. Once the profits start rolling in and the loans have been paid, then you can reasonably reap the rewards of your efforts.

 

Solution 8.1: Make a clear distinction between you and your business.

 

Your business and you are separate (often physical and legal) entities. So, the funds your business owns is not the money you own unless those funds are duly transferred to you (as to a legitimate business owner).

Although it’s slightly hard to make this distinction when you operate as a sole trader, it is still very important to understand this.

Your business is not you; it just operates for you.

If you mix things up, then chances are that you’ll hinder your business instead of helping it.

So, make a rule to take any money out of your business only when it is financially and strategically justified.

 

Pro tip: On the contrary, throwing too much money into your business for no reason can be another potential mistake. Do not subsidize your business for no solid reason. Avoid investing extra cash to diminish its deficiencies.

Your business must stand on its own feets and become self-sustaining.

Accurate business data is critical in making the necessary improvements.

Too much help may cause subsequent failure.

 

Solution 8.2: Keep separate accounts.

 

Keeping your personal and business accounts separate will help you to not mix things up.

Below is the video by Nina Kaufman explaining why mixing your money is not a good idea:

 

 

Solution 8.3: Follow your procedures.

If you have specific procedures or rules for taking money out of your business – follow them.

Even if there are no penalties for the violation.

In case you do not have any procedures, but feel like it might help you – create them.

No need to make something fancy here. Even the most basic and straightforward procedures/rules may work.

In the end, it’s not the procedure itself but the compliance that matters.

 

Solution 8.4: Make sure all transaction between you and your business are at arms-length.

 

As you have separated your own personality from your business, now all transactions between you as an individual and your business as a business entity must take effect at an arm’s length.

This is important to ensure that the big picture of your business is not irrationally distorted.

 

Solution 8.5: Pay yourself a reasonable salary.

 

Pay yourself a reasonable salary that suits your business position.

Take money out of your business in the form of dividends instead of a salary or vice versa depending on your tax and financial situation.

Make sure that in all cases your salary is rational.

%

Failure rate for the fastest-growing companies in the US

Unexpected growth can destroy your business.

Do not repeat the mistakes made by Starbucks, Krispy Kreme, Pets.comCrumbs Bake Shop, Wise Acre Frozen Treats and others.

While many small business owners would love to have the problem of too many people purchasing their products, it can create the unusual situation of not earning enough money to expand the business to cover the additional demand.

This is particularly true for manufacturing firms that must purchase new equipment and add new space to keep up with the sales.

This is more of a business model issue, in the sense that most planning revolves around projections for a steady growth in sales.

If the demand should spike unexpectedly, it puts the business in the unusual situation of not having enough capital to expand and meet the demand.

 

Solution 9.1: Define if the unexpected growth is temporary or long term.

 

It is best to simply work with what you have as long as possible to see if the spike is temporary or long term before making any decision.

If this is a temporary phase, then the necessary adaptation should also carry an interim character.

You have to be able to return quickly to your previous state without negative consequences.

 

 

Solution 9.2: Get prepared by educating yourself and educating/empowering employees.

 

If it’s clear that the growth is dependable, then you might consider investing more resources to adjust to it on a long-term basis.

Probably the best thing you can do is to educate yourself and your employees about the upcoming changes. This will save you from adverse effects that the adjustment can bring to your business.

Jumping into rapid growth without being well prepared, or even worse without really knowing what exactly you are doing can be fatal.

 

 

Solution 9.3: Go ahead with a growth strategy only.

 

It is highly important to have a clear plan before you enter into a phase of rapid growth. Combine the education part discussed above with creating a detailed strategy, and you’ll be safe in most cases.

 

 

Solution 9.4: Control costs and debt.

 

The riskiest part of unexpected rapid growth is the finances.

You do not want to fail when it comes to costs and debts.

Any financial mistake you make directly affects your cash (and the impact is even greater with higher growth rates).

As you already know, cash is the lifeblood of business.

If finances are poorly managed during the rapid growth phase, the chances are that the business will fail very quickly.

 

 

Solution 9.5: Beware that fast-growing businesses need to be managed much more carefully.

 

Keep in mind that fast-growing business should be managed in a more intense way. Be ready for this.

In case you are not sure that you can make it, simply don’t go for it.

Instead, focus on a slower but stable and safe growth strategy.

10. Competition

 

It can be quite difficult for small businesses that are just starting up to survive against established competition.

The most common failures happen when not enough research is done in the field to see if there is any room for a new business in that industry.

While it is true that several businesses in an industry is indicative of consumer demand, it is also often the case that the established businesses are already handling most, if not all of what customers want.

 

Solution 10.1: Defining the potential to sell.

 

Research is crucial to see if the demand is sufficient for a new business to enter the market.

After all, the key to running a successful business is not the effort to sell a product, but finding a product that sells.

 

Solution 10.2: Finding gaps. 

 

Consider the growth rate and location of the competition to see if there are areas in your community that are not being properly served.

 

Solution 10.3: Accepting the challenge.

 

Calm down and understand that competition is a part of business and it’s up to you to leverage this for your benefit.

Accept the challenge, and this will correctly change your mindset.

 

Solution 10.4: Competition as a part of business plan.

 

Dealing with competition must have been part of your business plan. If so, then stick to it.

However, if you have missed this part during the planning stage, then the first thing you want to do is not to take spontaneous decisions. Instead, research your competition and prepare a solid strategy to overcome it.

Here are a few quick tips to help you with your strategy.

Competition in the context of business planning is a relatively broad topic and obviously out of the scope of this article. For better results, we recommend researching this on an individual basis or simply moving to Solution 10.7.

 

Pro tip: The best way to research your competition is to become a customer. Buy from your competitors to identify their strengths and weaknesses.

 

Solution 10.5: Sharing with competition.

 

Realize there is plenty of business to go around for everyone, even in a saturated market.

While you want more and more of that market share, the fact is that you probably couldn’t handle one hundred percent of it. So be nice and share as long as you get enough to keep going.

This however does not mean that the business should stop competing at any point.

Business is a non-stop growth machine in essence. Once stopped it starts to go down.

 

Business is a non-stop growth machine. Once stopped it starts to go down. Click To Tweet

 

Pro tip: Implement a two-fold approach towards your competition.

  1. Identify the best and the worst things your competition does.
  2. Match this with what your business does.
  3. Adopt the best aspects of your competition that your business lacks and get rid of the worst ones.

If implemented correctly this strategy will help you to double win your competitors.

 

Solution 10.6: Focus on your business.

 

This is an alternative approach to dealing with competition.

The idea behind this is that the more you focus on your competition, the less your focus will be on your own business.

More time spent dealing with competition = less time spent improving your own business.

 

More time spent dealing with competition = less time spent improving your own business. Click To Tweet

 

 

Blackberry’s futile attempt to compete with Apple and Google meanwhile moving in quickly to capture the smartphone market is a good illustration of this formula.

When BlackBerry finally did launch a touchscreen device, it was seen as a poor imitation of the iPhone.

Too much focus on competition laid the ground for Blackberry’s subsequent failure.

In Q1 2009 BlackBerry owned 20.1 % of global smartphone OS market share.

This is how the market shares look as of January 2017:

  • Android 63.99%
  • iOS 32.03%
  • BlackBerry 0.49%
  • Other 3.49%

The universal solution: do not accept failure

 

In the end, anyone who starts up their own business will need to take all the major risks into account to have the best chance of success.

Preparation is one of the keys to success when starting a small business.

While you cannot take everything into account before you begin, by being prepared for the most common reasons of failure, you can improve the chances that your small business will be successful.

By focusing your efforts on running a tight business model, you can avoid many of the pitfalls that cause small businesses to fall apart.

As we see from the research above, all major reasons for new business failure are somehow interconnected, and almost all of them point to the same roots: poor planning, incompetence, lack of persistence.

The success of your small business will ride in large part on the effectiveness of your planning and research, and keeping overheads at levels that allow your products or services to be purchased by the public.

The more work you do before launching your small business, the better chances you have of enjoying success.

The sole reason for business success is the entrepreneurs themselves.

If you refuse to fail, you won’t fail.

As Adeo Ressi (The Founder Institute) puts this into words: there is only one reason why the business fails – it’s when the entrepreneur gives up.

That’s it.

Period.

We’ll be glad to hear your thoughts!
Please share them in the comments section below.

Top Recycling Business Ideas 2017: Best Green Opportunities

Top Recycling Business Ideas 2017: Best Green Opportunities

Recycling Business Ideas

 

One of the most innovative areas for starting up a new business is recycling.

Even more, going green is a trend of today. Recycling business is the business of the future.

 

Recycling business is the business of the future. Click To Tweet

 

With all the valuable materials that get dumped into a landfill happening every day, starting up the right type of recycling business offers you a real opportunity to do something good for the environment and make a profit as well.

 

Related: How to Start a Business: The Ultimate Guide

 

Many people start with aluminium cans which is great for making a little money on the side, but real recycling businesses focus on other materials that are even more valuable.

There are hundreds of recycling ideas for businesses out there. In this blog post we provide the top 10 recycling business opportunities that will help you build up your company and if done in a right way – enjoy real profits.

Here they are:

 

1. Construction

 

This is a pretty straightforward small scale business idea.

There are many different materials that can be recycled from construction waste, including metals, electrical materials, hardwood, and more. All you need to do is collect them and sell them to recycling centers or directly depending on their condition.

 

2. Cooking Oil

 

This type of recycling takes away the impurities from used cooking oil so that it is fresh once again. By offering the clients this service, they can have their used cooking oil taken away and will purchase the recycled cooking oil from you as part of the process.

 

3. Electronics

 

The electronic recycling is another way to build your recycling company. Purchasing scrap electronics from devices and other sources and selling them to recyclers will offer a considerable profit margin for your business. The types of devices that can be recycled or even refurbished are laptops, computers, mobile phones, and electronics of all types.

 

4. Garbage

 

Relatively low investment business idea; You can recycle the garbage from homes and businesses, picking up their debris on a regular basis and providing bins that separate out the recyclable material. This makes it easier for businesses to recycle and for you to make money after a reasonable investment.

 

5. Printer Cartridges

 

This is another highly popular form of recycling businesses thanks to the price of the printer cartridges. 🙂

A simple cleaning and refilling process will provide you with a good profit while offering cheaper cartridges to businesses and corporations.

 

6. Scrap Gold

 

Certainly, one of the most profitable recycling businesses. The good news about gold is that it is easy to melt, malleable, and does not lose its purity even when used repeatedly. Add to this that gold recycling is cheaper and better for the environment than mining and you have a real winner.

 

7. Tires

 

Recycling tires have been around since World War II. Considering all the tires that are still in landfills and other areas, recycling them is something desired by everyone. However, it is a dirty job and finding the right companies to work with can be problematic. Still, if you can set up a tire recycling business, the profit potential is considerable.

 

8. Wood

 

Wood historically has always been recycled. Even today, timber still can be recycled in eco-friendly ways. On top of that, there is a solid belief among potential customers that by purchasing recycled wood, the demand for “green timber” will fall and ultimately benefit the environment. Thus, recycled wood products with “eco-friendly” labelling have potential to boost the sales.

Recyclable wood is easily obtainable through construction waste, demolished buildings and infrastructural objects, old furniture and other similar sources.

 

9. Glass

 

The glass is 100% recyclable. Even more, glass can be recycled endlessly without any loss in quality or purity. For every ton of the recycled glass over a ton of natural resources are preserved.

 

Glass Recycling Infographic

 

Image Source: GPI

Read also: Frequently Asked Questions: Glass Recycling – Stanford University

 

10. Waste Collection Center

 

This is a simple and low cost business idea. You probably have such sites in your own community, but there are still plenty of opportunities to start your own recycling business. Your recycling plant can include a number of items from cans, paper, and bottles which you can ship to larger centers and get cash.

 

We have listed the best 10 recycling business ideas. However, there are many other recycling business ideas that you can leverage to build up a profitable company.

 

Below are some great resources for further guidance:

Bureau of International Recycling

US Environmental Protection Agency

Recycling Guide

RecyclingToday

 

Related: When It’s Time to Start Your Own Business?

 

 

DISCOVER MORE CONTENT FROM MILL

12 Tips To Avoid Procrastination

How to Avoid Procrastination: 12 Super Practical Tips

What Is Procrastination And How To Avoid It?   Your to-do list is ready and looks amazing. You just need to complete the listed tasks and you’ll be definitely fine. It feels so exciting… Well until it is actually time to start carrying out...
Read More
How To Choose The Right Name For Your Business

How to choose a great name for your new business/startup?

Name selection for your new business is an important and crucial process. This decision will influence your business throughout its entire lifetime. It may sound easy, though. What a big deal in the end? You just starting out and any name will...
Read More
Startup vs Small Business

What Is a Startup? And How It Is Different From a Small Business?

Too many look at startups and small businesses and assume that they are the same thing. In reality, though, they are quite different. While they have some similarities, they are not the same thing at all. The two words are not interchangeable. Luckily, it is easy to...
Read More
What Names Acceptable For UK LTD

What Names Are Acceptable for UK Limited Companies?

Most names are acceptable to Companies House, but there are number of exceptions which fall into the following categories: 1. The proposed company name must be unique, meaning that there must be no other company...
Read More
Small Business Tips

14 Keys to Success for Small Business

The success rate for new small businesses is relatively small, so making the most out of your opportunity is imperative. From starting up your company to hiring employees to keeping an eye on expenses and creating a website to reach customers...
Read More
Best US cities for startups in 2016

Top 25 Startup Hubs in the US [2016]

  According to a report released by the U.S. Chamber of Commerce Foundation and startup incubator 1776 Boston is ranked number 1 among the top 25 startup hubs in the U.S. Boston moved to the top spot as a result of San Francisco Bay Area’s lack of a cohesive...
Read More
Quick Business Tips - Mill For Business

55 Remarkably Simple And Crazy Powerful Quick Business Tips

There are hundreds of tips that can help you run a business, but these quick 55 will literally skyrocket your business!   However, for that you still need to follow them after reading. 🙂   So, here they are:   1. Always Stay Positive 2. Wake Up Looking...
Read More

We'll be glad to hear your thoughts!
Please share them in the comments section below for us and our audience to read and benefit!

55 Remarkably Simple And Crazy Powerful Quick Business Tips

55 Remarkably Simple And Crazy Powerful Quick Business Tips

There are hundreds of tips that can help you run a business, but these quick 55 will literally skyrocket your business!

 

However, for that you still need to follow them after reading. 🙂

 

So, here they are:

 

1. Always Stay Positive

2. Wake Up Looking Forward to Your Day

3. Start Early and Work Until It Is Finished

4. Get Out of Your Comfort Zone

5. Always Present your Best Self in Business

6. Keep Expenses to a Minimum

7. Keep Overhead to an Absolute Minimum

8. Never Sell Products at a Loss

9. Look for Ways to Eliminate Expenses such as Rent by Buying your Own Building for instance

10. Never Cut Your Marketing Budget

11. Know When to Cut Your Losses on a Marketing Campaign

12. Look for ways to Build your Business Brand

13. Always Look for New Ways to Sell your Products

14. Always Look for New Ways to Market Your Company

15. Find Ways to Market Your Products for Free

16. Utilize Traditional Marketing Methods

17. Incorporate your Logo in All Advertising Efforts

18. Market to Potential Customers on Multiple Fronts

19. Always try to Increase your Marketing Budget

20. Re-evaluate Your Business Model Every Year

21. Always Be Open to New Ideas and Trends

22. Seek Out a Mentor to Help You in Specific Areas

23. Stay Informed and Read Every Day

24. Look for learning opportunities in everything

25. Become the Authority in your Field

26. Keep an Eye out for New Trends

27. Evaluate All Trends Before Jumping On Them

28. Remember sometimes the Tried-‘n-True can become Old and Useless

29. Keep a Sharp Eye on the Competition

30. Establish the Best in Customer Relations

31. Know your Customers and Tie into their Interests

32. Seek Out Clients that can Help Your Business

33. Maintain Contact with Established Customers, they are the Heart of Your Business

34. Minimize the Distance between Decision-Makers and Customers

35. Take Out the Minimal Amount Needed for Loans

36. Find the Right Sales Pitch and Use It Until It No Longer Works

37. Start with One Product and Build Up Your Business

38. Set High Goals, but Never Spend as If You’ve Reached Them

39. Stay within your Niche

40. You cannot become All Things to All People

41. Outsource to Professionals Whenever Possible

42. Hire Better People than you at a Particular Job

43. Become Involved in Local Events and Charities

44. Always Be Friendly to Everyone as You’ll Never Know When You Might Need Them

45. Use every Tax Deduction Possible

46. Set Daily Goals and Note Improvements

47. Prioritize Wisely

48. Always test and try to beat the winner

49. Don’t Worry About Making Mistakes, Everyone Makes Mistakes

50. Relax so that Stress does not Build Up

51. Failure is a Part of Success

52. Never take “No” for an Answer

53. Learn from Your Mistakes

54. Never Quit, Quitting is the only true way to Fail

55. Take notes of favorite tips while reading this post and make sure you try them out 🙂 (Read this post on How To Avoid The Procrastination if you feel like procrastinating and not taking notes!)

The success or failure you experience in running your business will depend with staying on track, never overspending, and never giving up.

If you can follow these tips, you have the guideline to run a successful business that can take you as far as you want to go in life.

We’ll be glad to hear your thoughts!
Please share them in the comments section below for us and our audience to read and benefit!

First Time Starting a Business?

Read The Ultimate Guide From Mill Before You Do!

Read Now

Top 25 Startup Hubs in the US [2016]

Top 25 Startup Hubs in the US [2016]

 

According to a report released by the U.S. Chamber of Commerce Foundation and startup incubator 1776 Boston is ranked number 1 among the top 25 startup hubs in the U.S.

Boston moved to the top spot as a result of San Francisco Bay Area’s lack of a cohesive community and declining quality of life for residents. However, San Francisco Bay Area still remains as an absolute leader when it comes to total startup activity.

Some cities with a fewer startups such as Denver and Raleigh-Durham outranked larger cities like New York and Los Angeles by having stronger ties between the startups and institutions in the community.

 

Innovation That Matters evaluated 25 cities, digging into six themes:

1. Talent
2. Capital
3. Industry Specialization
4. Density
5. Connectivity
6. Culture

 

While the number one was revealed based on total ranking the leadership of the best cities was not consistent in every aspect the report finds.

For example, Boston being a leader for capital and density, ranked only number 8 for talent and ecosystem connectivity and only number 4 for culture. Similarly, Buy Area being number 1 in talent, capital and industry specialization was only 17 for ecosystem connectivity and 9 for culture.

This demonstrates that emerging players can leverage their strengths (e.g. Baltimore ranking only 18th based on the total of all metrics was #1 in the ecosystem connectivity), while the leaders might consider working on raising up the consistency across all metrics.

 

Here is the full list of top 25 startup cities in the US according to ITM:

1. Boston
2. Bay Area
3. Denver
4. Raleigh-Durham
5. San Diego
6. Austin
7. Los Angeles
8. Philadelphia
9. Washington DC
10. New York
11. Seattle
12. Chicago
13. Portland
14. Pittsburgh
15. Nashville
16. Minneapolis
17. Salt Lake City
18. Baltimore
19. Dallas
20. Houston
21. Atlanta
22. Miami
23. Phoenix
24. Kansas City
25. New Orleans

Read Full Report

 

Related: What Is a Startup and How It Is Different From a Small Business?

We’ll be glad to hear your thoughts!
Please share them in the comments section below for us and our audience to read and benefit!

How to Avoid Procrastination: 12 Super Practical Tips

How to Avoid Procrastination: 12 Super Practical Tips

What Is Procrastination And How To Avoid It?

 

Your to-do list is ready and looks amazing. You just need to complete the listed tasks and you’ll be definitely fine. It feels so exciting… Well until it is actually time to start carrying out those tasks on the list. And when you actually start?

Well, often you start when the pigs fly. Or sometimes you start immediately and then you notice how the efficiency decreases, you get systematically distracted and inspiration/motivation fades away.

This unproductive state of things is known to everyone and it is often the natural outcome of procrastination.

The main difference between a loser and a winner usually lies in a person’s daily habits.

Most of the people nowadays fail to get a job well done in real time or end up with a poor outcome because they just can’t help themselves from procrastinating.

Procrastination is a perfect way for us to get stuck up and yet, many of us keep being totally unaware of this phenomenon controlling and harming our lives. Unknowingly, we always easily create or find persuasive arguments right in our minds to delay the tasks that are at hand. And the worst part is that often times this feels to us pretty natural.

Procrastination is in fact (natural) normal and all of us instead of working just fool around from time to time. Nevertheless, you must decidedly avoid it if you want to be productive.

It is just like in business, if you want your company to have success, you must always bear in mind that your victory requires commitment, time and effort, most especially with the fact that a business always mean taking risks of failing just to get what you want to achieve.

Sometimes this habit happens due to those mundane stuff such as sorting through your old files, tidying your linen board or reconciling your accounts. Delaying, slacking, putting off things, hiding from work or facing work in your business when it’s already unavoidable will not help you. Yes, the classic “bury head in the sand” situation. (Did you also thought of Ostrich?)

You bury head in the sand again when you do nothing while it is so obvious that this bad habit would just eat you away and would certainly prevent you from achieving success and greater results in your life. The chances that it won’t are too low as our achievements are always fruits of our efforts.

Don’t ever let procrastination take over your whole life. Don’t do it because you canavoid it.

The following strategies can help you in avoiding procrastination effectively:

1. Include deadlines to your to-do list

Write down all your goals and then give yourself a specific deadline. Yeah, this is the same old to-do list, but with serious deadlines.

In this way, you will be focused and well reminded that there will be no other time for you to do a thing but now. A goal without a specific deadline can be just put off carelessly/indefinitely.

2. Make tasks smaller

Break your goals into small pieces. Big goals can make you feel overwhelmed with it and may make you think that it is unachievable.

This negativity is the main reason of procrastination. So if you see that your goals feel too heavy to trigger the necessary action then you better break them into small parts.

As soon as you do it the big “unachievable” goal may end up with turning into a piece of cake for you. Here, without you knowing it, the steps will just become obnoxious to you as you move forward.

3. Remove distractions

If you really want to get the work done – remove distractions. Identify what distracts you the most (checking social media updates, email, cell phone etc.) and get rid of them until you are done. You may even temporarily deactivate your Facebook account (no worries to reactivate you will simply need to log in).

Alternatively, you may think of using a relevant software to block your online distractions. There are plenty of them on the web like FocusMe,  Cold Turkey orFreedom.

You may also consider putting your phone to an airplane mode. Trying to stay focused on important things you need to have done is a sufficient excuse to be inaccessible for a while.

4. Two (five) minute rule

Sometimes we have small yet very important or even crucial tasks that we postpone.

Two-minute rule by David Allen suggests to immediately do your work or task that will take no longer than two minutes.

This rule is applicable when you need to reply to an important email for instance but feel like not willing to do it right now although it will take two minutes at best.

According to two-minute rule, you just reply to that email immediately and do not let yourself to even start thinking of delaying. You just automatically do whatever takes less than two minutes and become incredibly productive with this small shift in your attitude.

As an addition to David Allen’s rule, we recommend changing two-minute rule into the five-minute rule in order to cover a wider range of tasks. If you never postpone whatever takes you just five minutes to do, you’ll heavily increase your productivity.

Start testing today and you’ll love it. We love it! And it really works.

5. Reward progress 

Honoring yourself for a well-done job and small achievements will keep you motivated to be the best version of yourself.

If you are motivated in whatever that you do, it is almost guaranteed that procrastination will never set in.

Create a compelling system of rewards. What is important here is a foretaste. When you know that an amazing reward is there for achieving a specific goal you get crazy and importantly you often start to enjoy the process (this awfully boosts the level of productivity).

The reward must be super appealing while still objectively achievable though. So, do not set unrealistic or tedious rewards. You simply may pick whatever you like to do the most daily or weekly and set it as a reward.

6. Try Negative Reinforcement

This is an another effective way to fight procrastination. In order to get extra motivation you may consider taking away something bad (or something you really do not want to do) as a motivator.

For example, you may let yourself skip cooking and have flakes instead if you finish the work in time or whatever you absolutely do not want to do.

Does not sound that exciting, but still may work. Give it a try.

7. Penalty

When negative reinforcement does not work well for you then you may try penalty method to fight the procrastination.

It’s quite simple – you just punish yourself if you do not do things on time and let say do not go out that day or run an extra mile at the evening jogging.

Try to set positive penalties such as doing some extra sport or eating healthy food.

This way the penalty method will benefit you in any case: you’ll either finish the task in time or do something useful.

8. Power of Visualization

Leverage the power of visualization. Visualization is a great universal power, so you can make use of it in many cases including but not limited to procrastination.

Imagining your future success will pump you up and give you the drive. It will help you to get your job done in real time and stop the procrastination from affecting your performance.

While visualizing try to make yourself feel an amazing excitement of victory. This is what you are going to feel when you’ll achieve all your tasks and become amazing.

Make feelings stronger, colors brighter and voice of success louder!

You wanna feel that right?

Damn, YEAH!

So, do it.

9. Get out of Your Comfort Zone

Feeling good in you comfort zone and not willing to leave it is another cause of procrastination. In a modern world, you have to leave your comfort zone if you decided to be successful.

This became almost unavoidable nowadays.

So, break out of your comfort zone now. Our comfort zone limits us and fear or reluctance to run out of it can keep us from taking action. If you want to be successful, the sooner or later you must get out of your comfort zone and apparently the sooner is better.

10. Compete

Fair competition has always led to progress. If you have someone to compete with you’ll be kept naturally motivated.

Moreover, if you agree to compete on something with your friend or colleague this regardless of the outcome will eventually benefit you both. Competition is a strong motive force and it often feels just like a game where you do not feel like working while trying to win.

It’s very fun and highly effective way to forget about procrastination.

11. Track your progress

You need to track your progress in order to see if your efforts increase your productivity. Tracking makes the whole process transparent and precise. You see what you’ve done and what actually remained undone.

Remember, failing to track the progress is another shape of procrastination. Unless you have the clear picture of things you may falsely consider them to be fine. However, often this is not the case and an immediate action is needed from your side to put things in order.

12. Ask for help

If you implement strategies above (at least some of them) you’ll be able to avoid procrastination and increase your productivity. As there is no magic bullet for it, you’ll need to do at least something to get rid of this bad habit.

In case, you lose your focus and are not able to continuously follow the strategies ask for help!

Seriously. People like when you sincerely ask for their help. Tell to someone you trust to help you with avoiding the procrastination. It is much easier to follow strategies when you have some sort of accountability. This way you’ll be forced to deliver the results and who knows maybe this will reveal your momentous hidden talents!

And the most important takeaway is to TAKE ACTION NOW!

Do not wait for any other moment. This is the best moment to start becoming better.

Further Reading: How to Start a Business: The Ultimate Guide

Do you have something to add? We’ll be glad to hear!
Please share your thoughts in comments section below for us and our audience to read and benefit!

Pin It on Pinterest