10 Vital Reasons for the Failure of Online Business Startups In the modern times of advanced technology, the rise of online business startups have been a recurrent phenomena. With the growing demand of everything being available at the tap of your finger, be it food, apparel or medicine, entrepreneurs worldwide are coming up with the most convenient solution- ‘online business venture’. But unfortunately, many fail to meet the prerequisites of starting an online business & are also unable to maintain post-startup requirements. In order to evaluate why most online business startups fail, let us briefly cast a look into some of the factors involved in it: Lack of Support: When you start up an online business venture, you are quite enthusiastic & overwhelmed about the idea of providing more than needed services, catering your customer’s needs, conducting prompt delivery, acquiring products & other such tasks, all by yourself! You often consider yourself to be a champion in multitasking & forget the reality. Online business ventures are domain that require strategic distribution of work through various people. For e.g. an e-commerce site will have a group of staff for acquiring & buying the product from the market, another group for listing it on the website, another group for delivery & so on. You can be the owner of the website but you cannot perform the related functions, simultaneously. Poor Planning/Strategy: you suddenly have an idea of starting an online business website but you are blind to the pros & cons of it. You lack the sufficient funds, associations & effective strategy to promote your ideas & also didn’t do enough research on it. In short, a decision taken in haste will adversely impact rather than benefit. Remember, slow & steady definitely wins the race! Underrated Promotion: as an entrepreneur, one may not attach immense importance to promotion. Ironically, promotion is first vital step towards establishing a new online business startup. Promotion does not necessarily mean a high-scale one but you can start out through a small base like from your circle of family & friends. You can take feedbacks from them, work on it, incorporate authentic reviews & gradually promote on digital platforms like Facebook, Instagram & others. It’s nice to start small & when situations look conducive, grab the opportunity. Inadequate funds: One of the main reasons for the failure of online business startups is lack of finance. Practically, an online business is the same as the business conducted in reality like in shops; the only difference is that we go to purchase products in the stores while for online shopping, we just tap the product on the screen & it comes to us. Apart from this, the
requirement of financial resources are same in both the kinds. The same amount of money is needed for buying the product, human resource, shipping, packing & so on. If you are thinking that an online business would require lesser funds than real stores, do think twice before jumping into the conclusion!
Poor product: another reason could be poor quality standards of the product. The picture shown on the online site may be appealing but in reality, the product is nowhere close to the one shown. Thereby, if some of the customers are dissatisfied, the online site will soon suffer from imputation resulting in failure. Price Listings: Often many online business startups fail due to severe price issues. Entrepreneurs suffer from a dilemma whether they should maintain a healthy profit margin or provide maximum benefits to the customers. This becomes a difficult choice to decide upon & often leads to failure. It would be advisable to fix a moderate price so that profit can also be incurred as well as enticing customers, simultaneously. Competition extremity: when you end up offering a better product at an affordable price, chances are other large renowned companies & new startups will also bulge in try to compete against you. Sometimes this contributes to the failure of maximum online business startups. Non-customer friendly- for many business men & women, customers are like gods. It is essential to take feedbacks & suggestions from customers & take action accordingly. But unfortunately, most of the new startups pay no heed to the feedbacks & continue with their drawbacks, leading to failure. Going with the Trend: To set up an online business site, it is important to evaluate the need of the changing times. For e.g. there was a time when STD/ISD booths were very much popular due to the absence of mobile phones. But when mobile phones were introduced, the number of these booths decreased & converted into recharge shops, gradually. Thus establishing an online business startup that offers products & services that are no longer required, may lead to consequential failure.
Lack of user-friendly website: The key to a successful online business is a user-friendly website. The website design company, should create a positive impression on the minds of the customers; this means the colour, symbol, text & layout should be soothing to the eye. Moreover, the website should provide adequate information about the products & services & also include important pages like About Us & Contact Us. Conclusion: In line with the above analysis, online business ventures can become successful if these points are kept in mind. Majority of online business startups fail due to these reasons. So before you start any such venture, make sure you plan things accordingly & analyse the requirements judiciously.
Source: https://colivre.net/webguruinfosystems/reasons-whymost-of-the-online-business-startups-fail
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