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Your # 2, under capitalized, is probably the most common reason by far that most businesses in general, not just home based, fail. I would also rate lack of preparation and homework right up there too. Some people just don't know what they're doing, nor how or where to get the knowledge required. I've worked biz-to-biz1 of 1 people found this helpful
for many years and have seen thousands succeed, but many many fail too. so that's my educated take.
I have noticed that most home based businesses tend to think because they are working from home, there is no need to incorporate. That could not be farther from the truth. If you are working from home it is even more important to build and establish a strong business credit score seperate from your personal credit score, to portect your personal assets, and in order to obtain a strong business credit score, you would have to be set up as a corporation, or an LLC.
The reasons you mentioned are very good, but I feel they apply to any start-up company or small business. An often over-looked, but in my opinion, a huge factor: lack of focus. Operating out of such a comfortable and familiar setting can cause one to become too relaxed and complacent with their work. Not to mention, there are a million distractions, ranging from the TV to non-business home calls to sifting through the days mail. No one is there to regulate you or keep you on track. It takes a very strong willed, determined person to succeed with a home based business.1 of 1 people found this helpful
Reasons People Fail At Home Based Business, Welcome Rickey
Add lack of a business and marketing plan. A plan should serve as an assessment tool for the owner.
Then you open the door and get detracted.
As you grow your business, the plans will help you keep track of the details and make sure that the business is progressing as you intended.
My thought, LUCKIEST
Here are some more intangibles that most people who start
home based businesses don't think about.
4. Mindset - without the proper mindset you are doomed for failure.
You may know what to do but what's going to get you to do what you
5. Creativity - I call this the elixir of a home based business. I have been
able to do many things that others cannot because I have a creative mind. I seek
unconvential ways to getting things done. I find ways to go around, under, through
or over my obstacles.
6. Research - Knowing your target audience is paramount. So many people go into business just because
they think they have a good idea. They don't even know if there's a market for their
products or services. Even if there is a market they don't know if that market is willing
to pay for those products are services.