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When I stroll around the two-block main street in my town, I find myself feeling sad. That's because after nearly 20 years of covering small business, I have a pretty good sense of who's going to make it and who isn't. Those coffeehouses and art galleries located a block off the main drag, tucked out of sight? Yeah. I noticed over the holiday weekend they are all bust. Mistake: Bad location. Ditto for the restaurant on the little-used second floor of a mini-mall, which has changed out three times in recent years.
Is that easy to tell if a business is going to fail? Sometimes, it is.
But don't just take my word for it. Serial entrepreneur Neil Patel recently put together a nifty list on his Quicksprout blog of 15 signs your business is circling the drain. A few of my favorites:
1. You're not making a profit. Stop selling your widgets at a loss and trying to make up for it on the volume, as my grandfather used to joke. If you don't make a dollar at the end of the day, it won't matter how much volume you're driving.
2. No prospects. There's lots of dreaming and fantasizing and making pie-in-the-sky pie charts out there in startup-land, but to make the business happen, you'll have to actually go out and talk to potential customers. Lots of 'em.
3. You keep repeating your mistakes. Successful startups have a steep learning curve, you may have heard. That means you need to learn quick how to do things effectively.
4. No passion. Did you get into business just to avoid getting a job? Grab the first franchise offer you heard about? That often doesn't work out. The long hours required to launch a successful startup tend to fatigue those who aren't fired up about what they're doing.
5. No buzz. I've watched so many small business owners go under who never once appeared at a local networking event, sponsored a team, offered a coupon, printed a flier, held a contest, gave out free samples, nothing. Their death is utterly predictable. Do something to get customers talking about your business!
Want more? Here's Patels' complete list of danger signs.
Do these warning signs worry you? Never fear -- later this week I'll discuss some indicators that your business will succeed.
