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Team Gopher
08-25-2004, 11:07 PM
Top 17 reasons why LCO's fail

Here is some interesting information, can you think of others that might have been missed?

Things to consider and look out for. Source (http://asbdc.ualr.edu/bizfacts/8002.asp).

Failure Factors

- Inefficient control over costs and quality of product

- Bad stock control

- Underpricing

- Bad customer relations

- Failure to promote and maintain positive image

- Bad relations with suppliers

- Inability to manage and make decisions quickly and act on them

- Failure to keep pace with respect to the competition as well as the industry

- Illness or loss of personnel

- Reluctance to seek professional assistance (i.e., CPA, lawyer, or insurance agent)

- Failure to minimize taxation through tax planning

- Inadequate insurance

- Loss of impetus sales

- Bad personnel relations

- Lack of experience

- Insufficient working capital

- Bad budgeting

dvmcmrhp52
08-25-2004, 11:09 PM
Good post as usual gopher..................

Runner
08-25-2004, 11:20 PM
Now, the NUMBER REASON of ANY business failing,..and this is the most COMMON of all in ANY business failing. Poor cash flow. It happens all the time, and I'm guilty of it, too. I am NOT up to the calibur I should be at billing and collecting My weakness, and my most likely reason for a downfall. This is something I need work on - in the WORST way!

MMLawn
08-25-2004, 11:30 PM
Those aren't only LCO's that would fail with that list as any business could fail on those things as they are all general business failure items that could sink any business out there even wallyworld.

HOOLIE
08-25-2004, 11:31 PM
Runner,

I was thinking the same thing. I can still remember a long time ago, I was at the bank making a deposit for my boss, and there were about 15 amigos from another LCO up there cashing their paychecks. OOPS! The bank manager had to break the bad news- insufficient funds in the company bank account. I wondered if those 15 guys showed up for work the next Monday. Or if their boss hi-tailed it outta there as soon as they left for the bank...

Managing your cash flow is probably the single most critical point of running a successful business, IMO.

Kelly's Landscaping
08-25-2004, 11:46 PM
Cash flow is very serious but it can be lighted if you keep a large enough balance in the account. When we started we wanted 5 k at all times now it is 10-20 k as long as I have that I don't lose to much sleep as I know payroll is going to clear all month.

Up North
08-25-2004, 11:51 PM
Good info guys & Gopher. No matter whether your new to the business such as I, or if you've been around for a long time it all applies the same. Think I'll print this one out and hang it on my office wall. Thanks!

Buck

Lawn-Scapes
08-26-2004, 12:00 AM
I agree with Joe. Cash flow has been a problem for me and is the #1 reason I am still solo. I have always had more work than I could handle but never wanted to hire someone..... fear of not having a paycheck for them. I have been working hard this year on this issue and should be in good shape next spring.... fingers crossed.

Thanks for the info Gopher.