You’ve heard the alarming statistics, right? Almost two-thirds of small businesses never make it to their 10-year anniversary.
But what is the why behind these business failures? Most people assume it’s simply running out of money. While that’s certainly a factor, it’s usually not the most common reason. Another big one you often hear about is burnout. That’s definitely a prevalent symptom among business owners. I recently saw a post from an owner celebrating five years, who admitted that if they’d known how hard it would be, they never would have started.
So, what are the real underlying problems that lead to burnout, financial strain, and ultimately, business failure? Here are the three most common reasons, and here’s the good news: they’re all things you can absolutely do something about.
The Top 3 Overlooked Reasons Businesses Struggle and Fail:
1. Overly Optimistic Assumptions & Grandiose Plans
I see this all the time, especially in business planning. Owners (and sometimes even lenders!) make wildly optimistic assumptions about how many clients they’ll get in week one, or how quickly a new expansion will become profitable. We’re naturally enthusiastic, especially when we’re following our passion or investing in growth. But this unchecked optimism can lead to unrealistic projections that simply don’t pan out, leaving your business vulnerable.
2. Working on the Wrong Priorities
This is perhaps the most frequent challenge I help clients overcome. Many business owners tend to prioritize based on their gut feelings or emotions, which isn’t always the most effective strategy for business growth. Learning to make better decisions by prioritizing tasks based on solid data – and then actually allocating your time according to those priorities – is crucial. This focus on high-impact activities isn’t just about efficiency; it’s a powerful tool to prevent the burnout that plagues so many entrepreneurs.
3. Lack of Essential Business Skills
Here’s a fundamental truth that often goes unsaid: schools don’t teach “how to run a small business 101.” You can earn an MBA, but it won’t magically equip you with the practical, day-to-day systems and nuanced skills needed to operate a truly thriving small business. This absence of foundational business knowledge often leaves owners feeling stuck and/or burned out. When your business stops being fun, and starts demanding more work and time for less money, it’s often a clear sign of this underlying skill gap.
How a Business Coach Can Help
Every single business owner I’ve ever worked with is busy. They all have a million things on their plate. A coach’s role isn’t to just tell you to do more. Instead, we help you:
- Challenge assumptions and build realistic, actionable plans that actually work.
- Make better decisions by teaching you how to prioritize based on objective data, not just emotion or urgency.
- Develop the core business skills (like systematization, financial mastery, delivery mastery, effective delegation, and strategic thinking) that traditional education often misses.
We work with you to tackle your unique challenges. If you’re struggling with time, we’ll help you free it up so you can focus on what’s most important to grow your business. If you’re in a busy season, we’ll ensure you’re maximizing profitability by focusing only on high-margin activities and clearing your plate of distractions.
Hopefully, these insights help you spot and tackle the real stuff holding your business back. Getting a handle on these core issues is step one to building a business that’s stronger, makes more money, and is actually fun to run.
Author: Mark McNulty, Business Coach in Louisville, KY