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Top 7 Reasons Why a Business Fails

It’s hard to say goodbye. That’s not just a cliché. Saying goodbye is fairly tough—to a person; to your dream; to your cute little business! It’s tough to accept the fact when your business fails.

You had a dream… you had an idea… you wanted it to work, and you took the bold step to establish a business. But somehow things got haywire. When the circumstances demand the big decision, it is often heart wrenching to curb your emotions and take that big step.

After all, you have spent your money… you have spent your time… you have shed your tears, your blood, and your sweat to build your dream. By now you have an emotional attachment to your business. You feel shattered… you feel embarrassed… you feel ashamed.

Many thoughts run through your head. You console yourself with the thoughts of closing down for a while to get your act together, and starting again when you have the conducive environment. You find yourself determined to give your idea a second shot; albeit with the lessons you have learnt until now. You think about saving your assets until you are ready for the second stint. You consider the associated cost in holding on to the assets for all that time. And when you find it even more challenging to holding on to assets, it breaks you even more.

You ask yourself questions. What if I keep going for a little bit more before calling it a day? Will I really be able to start again? However, sticking on to the business that is not working is tough. You keep injecting money. You keep struggling with your staff, your clients, your sales, and more importantly, yourself.

Closing down a business is not for the faint hearts.

Really. But the good news is: closing down a business makes you tough and wise; only if you realize, that is.

When it is clear the business is failing, it is time to retrospect

What You Need When Your Business Fails?

All it is required to stand up again is courage, will and determination. Courage to face the situation and consequences of your decision to start again. Will to succeed in the face of all adversaries. Determination to make your dream come true.

Failure is not the end of the world. Failure is neither the opposite of success. On contrary, failure is the first step towards success.

Take the heart from what Thomas Edison said after his many unsuccessful attempts in making a light bulb:

“I have learned fifty thousand ways it cannot be done and therefore I am fifty thousand times nearer the final successful experiment.”

Thomas Edison

THIS is the mindset that gets you going. THIS is the mindset you need to achieve your dream.

Stop. Relax. And retrospect on what went wrong.

Why a Business Fails?

It is always good to think twice before starting a new business. According to an article published in Forbes, about 90% of startups fail globally. As a result, only one out of ten turns out to be a prosperous and sustainable business.

There could be several reasons why a business fails.

1. Choosing a Wrong Product

The biggest reason for a failed startup is creating a solution that never really had a problem. Fortune mentioned that about 42% of the startups fail because they work on a product that lacks market need.

You may have a great idea. You may consider your idea the best, and you perceive it to be loved by your clients too. But how would you know if your customers will actually like it? In fact, most entrepreneurs are afraid of their idea being rejected. When you are in love with your idea, I know it is difficult to hear any opposite opinions. But these are the opinions that can save you from even bigger heartbreak of seeing your business shutting down.

Unfortunately, most business owners start without proper market research. They go with their instincts, and just hope everyone likes it.

Lack of market research can be catastrophic for any business.

The method of conducting market research can be different for different businesses. Identify your niche, potential customers, and then depending on your business area, conduct your market research. If you are not sure about how you should proceed, check with the experts in your field. You can always find guidance on the internet on carrying out the market research specific to your business.

Whatever you do, do not ignore going through this extremely important process. As tiring or difficult as it may sound, but this is the number one effort that can grow or fail your business. Again, whatever you have to do to get this done, you must do it. Cannot emphasize enough.

2. Lack of Clear Vision

Many entrepreneurs start with the hazy picture of where they want to be, and what exactly they want to achieve. Without a clear vision, your business will be pulled in many different directions. It will be harder to create strategies, steer your business and grow accordingly.

If your business lacks direction, there is a little or no growth, you are having a hard time taking a decision, or you are experiencing costly delays, then your business lacks a long term vision. In this case, you immediately need to take action. You must set goals for your business, create a clear plan, define path, and stick to your vision all the way.

Keep in mind that plans are basically made to give your business a clear direction. Almost no plan goes hundred percent as it was originally planned. Changes to the plans are mandatory. However, those changes should not be at the cost of your vision.

Lacking of clear vision often turns the focus away from quality towards quantity. Many business owners start a business and try to take as much business as possible. In doing so, they become too diverse in their offerings, too often too quickly.

Having a clear vision will help you focus on what works in your business. It will allow you to take out anything that does not contribute towards your business goals. Having a clear vision also helps you in creating a compact marketing strategy. And, with a clear strategy, you can better define your market, your clients, and steps that you must take to achieve success.

3. Leadership’s Inability to Inspire

The leadership’s role is to create strategies, assemble teams, create work culture, provide guidance, and keep an eye on current and emerging business opportunities.

The ability for a leader to make everyone see what he or she is seeing is of vital importance. A leader must be able to transfer his or her vision to the team, so that the team works with the same energy and enthusiasm towards the goal.

Leadership should be able to demonstrate a constancy of character to attain trust, confidence and loyalty. As a business owner, you should be able to communicate your business vision to everyone that is associated with the business. Without having a strong character, it is not possible to pass on your mind and vision to the team.

4. Poor Management

It is the job of management to hire, train and mentor employees. If the employees are unable to get the work done, then the onus of failure falls on the management.

One of the common reasons why a small business fails is the owners’ inability to manage their team and business appropriately. While the owner may have the ability to create and sell a viable product or service, they often lack the qualities of a strong manager, or do not have adequate time to do so. Without a proper management team, there are high chances of mismanaging certain business aspects, such as finances, hiring, sales, marketing, and so on.

Smart business owners delegate the activities they do not perform well to someone who can. Therefore, it is important for the business owner to not only know his or her own abilities well, but also should be able to identify the abilities in his or her staff.

5. Lack of Finances

Another aspect of poor management results in the lack of finances. It is also one of the biggest reasons why a business fails. I will put the “lack of finances” again down to the management failure, because it is ultimately the management’s responsibility to appropriately manage business finances.

The business owners are usually more aware of their day to day expenses. They usually know their fixed and variable overhead expenses, such as salaries, rent, utilities, and so on. However, they are usually not totally aware of how much revenue they are generating through their sales of products or services. This disconnects leads to financial shortfall, which can quickly turn a business into a financial nightmare.

Moreover, the companies that operate in a highly saturated market, often provide their services or products at a far lower prices than their competitors. They do so with an intent to attract new customers. While this strategy is successful in some cases, keeping the prices too low for too long would ultimately result in shutting down the business. On the flip side, higher prices may result in good revenues, but should be backed with better quality, and smart sales and marketing strategies. If prices are not managed properly, the results would be unfavorable.

6. Poor Marketing

Small business owners often fail to prepare for the adequate marketing needs in their early marketing campaigns. Many business owners underestimate marketing requirements, and often miscalculate the capital required, customer reach, and customer conversion ratio projections.

Since marketing is crucial for the business, especially in the early stages, it is necessary to ensure that you have allocated sufficient budget for your marketing needs. Also, realistic projections related to customer reach, and sales conversion ratio is of critical importance for a successful campaign. Without proper consideration and planning, the marketing campaigns are more likely to fail, or eat more budget but still remain ineffective.

7. Failure to Adapt to the Changing Market

Business that do not timely adapt to the latest trends in the field are only just waiting for the failure. Most business changes occur due to increased competition, changed customer preferences or unpredictable economic environment.

As a business owner, you must keep yourself updated with the latest market trends, and how your competitors are adapting to these changes. And therefore, you should also adjust your business accordingly. In fact, more appropriately, you should be able to foresee the market changes in advance, and plan your strategy ahead of time.

The companies that deal with the continuous changes and turn the change into opportunity, will ultimately gain the competitive edge in the market. And the companies that fail to “ride the trend” often go down sooner than later.

We have seen many companies fail because they could not adapt to market change in time. For example, Nokia, who once was the biggest manufacturer of mobile devices, failed miserably because they could not keep pace with changing customer needs. They failed to catch up with Apple’s iPhone, resisted the change, and stubbornly stuck to Symbian OS, rather than adopting the Android OS like everyone else was doing. They could not improve their technology to match with that of Apple’s. So they ultimately ended up being sold to Microsoft.

So Why a Business Fails: Conclusion

Starting a business without a proper plan is a recipe of disaster.

If you fail to plan, you are planning to fail.”

Benjamin Franklin

To tell you the truth, businesses do not fail, but the leaders do. It basically all boils down to the leadership failure. It is ultimately the leadership’s responsibility to guide the business all along, and make the changes as necessary.

Some leaders are too tolerant or resistant to the idea of change. They are also afraid of doing experiments, and are not willing to appreciate a new idea. Then there are some leaders who are obsessed with the idea of perfection. So they press on things that are not necessarily required. Trying to achieve perfection is one of the biggest obstacles in growth.

Some leaders genuinely lack leadership or management skills that are required to run a smooth and successful business. If you happen to be such an aspiring leader, it is always a good idea to work with a business mentor that help you hone your skills to become a successful business owner.

Well, at the end of the day, as a business owner, if your business fails, you are only yourself to blame.

Check out this article to learn about the challenges for expat entrepreneurs in China.

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Picking the SQL Database For You

A Comparison of SQL Database Flavors: How To Pick The Right SQL Database Flavor For You?

SQL, or Structured Query Language, is a database that has widespread uses with many flavors– which we will explore. As such, in our data-driven world, SQL is fast becoming an essential skill. Therefore, in this article, we will look at the most popular flavors of SQL databases individually and then compare the database flavors together. In addition, we’ll help you figure out the right choice for you; in case you want to learn more about some key basic fundamental query building structure– CRUD Operations.

sql database code
SQL code

Two Types: SQL vs NoSQL

There are two main types of databases: SQL and NoSQL. Before we begin, it’s important to know the differences between the two.

While SQL is a relational database that employs a table-based structure, NoSQL is a non-relational database that employs a variety of data models for accessing, retrieving and modifying database. Moreover, SQL has a predefined database schema, whereas NoSQL has a dynamically defined schema.

Additionally, the most popular flavors are mainly based on SQL rather than NoSQL— only MongoDB makes the cut in the top 5 databases in 2021—with other examples like Elastisearch, DynamoDB not used as often by developers. MongoDB is so popular because of the flexibility in offers in database design and the high performance it delivers.

The Most Popular SQL Database Flavors in 2021:

  • MySQL
  • PostgreSQL
  • Microsoft SQL Server
  • SQLite
  • MongoDB

Moreover, the Stack Overflow Developer Survey 2020 has placed MySQL as the most popular database:

sql database flavors popularity rankings 2021
Stack Overflow
FeaturesMySQLPostgreSQLMS SQLSQLite
SELECT QuerySELECT col1, col2…SELECT col1, col2…SELECT [col1], [col2]…SELECT col1,col2…
Current Date FunctionSELECT CURRENT_DATE();SELECT CURRENT_DATE;SELECT GETDATE()’;SELECT date(‘now’);
Case Sensitive DataNo; WHERE city = ‘London’ and WHERE city = ‘london’ are the sameYes. WHERE city = ‘London’ and WHERE city = ‘london are differentYes. WHERE city = ‘London’ and WHERE city = ‘london are differentYes. WHERE city = ‘London’ and WHERE city = ‘london are different
Column AliasSELECT col1 AS COLSELECT col1 AS COLSELECT col1= COLSELECT col1 AS COL
Natural JoinNoYesNoYes
ORDER ByAllows ORDER BY; NULLs are considered lower than non-NULL valuesAllows ORDER BY; NULLs are considered higher than non-NULL valuesAllows ORDER BY; NULLs are considered lower than non-NULL valuesAllows ORDER BY; NULLs are considered lower than non-NULL values
Inserting Multiple RowsYesYesYesYes
BOOLEAN Data TypeNo; uses TinyInt(1)YesNo; uses BIT(1)No; uses Int
Timestamp FunctionYesYesNoNo
Concatenationconcat(String 1, String 2)String 1 || String 2String 1 + String 2String 1 || String 2
List of DatabasesSHOW DATABASESSELECT datnameFROM pg_catalog.pg_databaseEXEC SP_HELPDB.databases
Dummy TablesNoNoNoNo
Window FunctionsYesYesYesNo; subqueries used.
Auto IncrementAUTO_INCREMENTSERIALIDENTITY()AUTOINCREMENT 
Key features and syntax comparison of SQL databases

MySQL

MySQL was created in 1995 to build on the original SQL, as an open source relational database management system (RDBMS). In addition, its queries are run on the MySQL Command Line Interface (CLI) or on MySQL Workbench.

Key Features & Advantages of MySQL:

In addition, MySQL has gained immense popularity for its efficacy, ease of use, performance and powerful execution and database performance:

  • Extremely fast for read-heavy workload
  • Capable of replication
  • Cloud-scalable database

Subsequently, let’s look at some advantages below:

  • Easy to use
  • Low memory leakage; memory efficient
  • Runs on all OS: Windows, Mac OS, Linux, etc.
  • High performance

Disadvantages of MySQL:

MySQL is one of the most used databases around the world. Still, it has some disadvantages you want to keep in mind. Let’s look at some below:

  • It does not handle transaction statements effectively
  • Lack of debugger tools

PostgreSQL

postgresql release years
Photo by Alibaba-cloud

PostgreSQL, or commonly known as Postgres, is also an open source object-based relational database management system (RDBMS) initially released in 1996. Moreover, its queries are natively run on pgAdmin, its client. In addition, PostgreSQL is a great database language for beginners because of its broad applicability.

Key Features & Advantages of PostgreSQL:

PostgreSQL focuses on SQL compliance; in other words, it is growing into one of the most popular flavor of SQL in recent years:

  • Client-server model architecture
  • Offers geo-location queries
  • Data integrity
  • Support for JSON data types

After that, let’s take a look at some advantages now:

  • Larger data storage for databases
  • Multi-version concurrency control (MVCC) without read locks
  • Creates views that are updatable
  • Creation of user-defined functions, triggers, data types, etc.
  • Runs on all operating systems: Windows, Mac, Linux, etc.
  • Robust and powerful
  • Huge community support
  • Compatible with many programming languages like C, Python, etc.

Disadvantages of PostgreSQL:

Despite all these advantages and features, Postgres, like any other language, also has its own disadvantages. Therefore, let’s take a look at some below:

  • PostgreSQL struggles in performance factors
  • It is responsible for more memory utilization of computer
  • Data replication is hard

Microsoft SQL Server

Microsoft SQL Server, or MS SQL, is a relational database management system developed by Microsoft in May 1989. Similarly, its queries are natively run on SQL Service Management System (SSMS). In addition, SQL Server is an important part of the Microsoft Data and Business Intelligence platforms.

Key Features & Advantages of MS SQL:

MS SQL is a language that’s growing in userbase with its widespread use. MS SQL is used by companies like Dell, Yahoo, etc. Therefore, let’s look at some key features:

  • Data compression
  • MS SQL is highly secure
  • Its installation process is streamlined
  • It offers different versions to suit personalized needs

Consequently, MS SQL is one of the most popular database languages today, so it makes sense to see some of its key advantages:

  • Free for developers
  • Useful online documentation
  • Debugging tools on SMSS
  • Great community support
  • Highly secure
  • Easy installation with automatic upgrades
  • Easy maintenance

Disadvantages of MS SQL:

In the end, there is no database language that is perfect. Therefore, let’s explore some disadvantages of MS SQL. In other words, like any other database, MS SQL also has negative factors that may affect your choice:

  • Performance tuning is hard
  • There can be a bit of learning curve
  • May be overwhelmed with the huge number of features offered alongside

SQLite

SQLite is a RDBMS built in C library with its primary use being in mobile applications. Unlike other databases. it is not based on client-server architecture, but rather makes use of the embedded architecture.

Key Features & Advantages of SQLite:

SQLite is gaining popularity for its features, customer service and quality. Let’s see its key features in the list below:

  • Configuration doesn’t exist– no installation required
  • Has an easy to use API

SQLite has a lot of advantages that we will look at now. Let’s see what these benefits are below:

  • Runs on multiple OS: Windows, Linux, Mac OS etc.
  • Installation not required
  • Server-less database
  • Flexible and fast database
  • Uses less amount of memory on runtime

Disadvantages of SQLite:

In the end, SQLite has the following disadvantages that we will look at now:

  • Performance compromised because of file system configuration
  • Write operations are recorded
  • Database file size is smaller (15MB)

MongoDB

MongoDB is a document-based database, unlike all the others on this list. As a result, it uses JSON-documents for storing data instead of tables. In addition, you can start writing query from its official editor available at this link.

Key Features & Advantages of MongoDB:

MongoDB is the most popular non-relational database because of these features:

  • Data stored in JSON-documents
  • Indexing used for traversal
  • Horizontally scalable database

In addition, the following are its advantages:

  • Flexible database schema, dynamically defined
  • High speed of access time
  • Easy to setup environment

Disadvantages of MongoDB:

After that, let’s look at some disadvantages:

  • JOINS not allowed
  • Data size is limited in MongoDB

The Right SQL Database Flavor For You Is…

sql database graph question ranknig
A graph from Datacamp

In fairness, it’s difficult to choose one database generically, since each database serves a goal or purpose.

SELECT e.emp_name, AVG(s. salary) AS average_salary
FROM employees AS e
LEFT JOIN salary AS s
ON e.emp_id = s.empid
WHERE e.city = 'USA'
GROUP BY e.emp_name
ORDER BY s.salary;

For instance, this code example above shows that the syntax is actually quite similar. However, it can be seen because the query output is same for MySQL, PostgreSQL and SQLite, there is not much syntactical differences.

However, Microsoft SQL Server is the one that consists of the most differences between all of them.

In other words, the right database for me may not necessarily fit or be the right one for you. As a result, each database is optimized for a specific purpose or need. Therefore, how do you know which database fits for you?

Above all, which database can you learn or base your backend in?
Then, let’s explore some key factors in helping you determine the right SQL database flavor for your needs.

Speed Of Databases:

  • MySQL is fast for concurrent activities
  • PostgreSQL is quite fast
  • Microsoft SQL Server is slower
  • SQLite is fast but not the fastest as compared to others
  • MongoDB is extremely fast for data retrieval since it uses indices to traverse

Performance Of Databases:

  • MySQL has limited performance optimization
  • PostgreSQL is responsible for high performance database
  • Microsoft SQL Server offers high performance and data compression
  • SQLite runs smoothly
  • MongoDB has a great performance because it relies on jsons

Database Sizes Of Databases:

  • MySQL supports limited size database in some scenarios.
  • PostgreSQL supports large database
  • Microsoft SQL Server supports large databases
  • SQLite supports big databases, but with limited file size
  • MongoDB supports large databases

Eventually, you need to ask yourself what factors matter most in your needs before you can aptly choose.

Which Database Should You Choose?

If you’re looking for a fast, high performance database that will be easy to use, MySQL may be the right choice. But, if you’re working on a much larger database or complex queries— PostgreSQL may be the right choice for you.

On the other hand, if you are working with highly sensitive data, then the security, integrity and sturdiness of Microsoft SQL Server may be the perfect choice for your needs. Similarly, if you want fast, portable, and reliable database that runs on multiple operating systems, SQLite may be great.

Furthermore, if your business and data requirements are evolving over time and you need to scale accordingly, the document-based database, MongoDB could be a wonderful selection.

Conclusion to Comparison of SQL Flavors:

SQL consists of multiple flavors of databases used around the world with varying popularity. In addition, these flavors of databases carry plenty of similar traits and syntactically are akin.

Similarly, we proceeded to look at the top 5 databases in the world today individually and then compared the results together; it’s hard to pick one generically since each database serves a goal or purpose.

In conclusion, I hope you will find this post useful. Please share your thoughts in the comments below. Also, like the post if you learned something new here. Subscribe to our blog. Stay updated on all related content. Lastly, let us know your thoughts about this post in the comments. Thanks for reading. Stay safe and stay healthy.

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