The alarming stats for SME with poor marketing
The ultimate network building marketing tool
Maurice Watts
Last Update 3 days ago
Top sectors of business failure 2024
1. Retail: Retail businesses face challenges such as changing consumer preferences, competition from online retailers, and high operating costs.
2. Food and beverage: Restaurants and food businesses often struggle with high overhead costs, seasonality, and stiff competition.
3. Construction: Construction companies can fail due to economic downturns, project delays, and cost overruns.
4. Real estate: Real estate businesses are vulnerable to market fluctuations, changing interest rates, and regulatory changes.
5. Manufacturing: Manufacturing businesses can fail due to supply chain disruptions, rising production costs, and changing consumer demands.
6. Technology: Technology companies face intense competition, rapid technological advancements, and high research and development costs.
7. Healthcare: Healthcare businesses can fail due to regulatory changes, rising costs, and changes in reimbursement policies.
8. Transportation and logistics: Transportation and logistics companies can fail due to rising fuel costs, regulatory changes, and increasing competition.
9. Hospitality: Hospitality businesses such as hotels and resorts can fail due to economic downturns, changing travel patterns, and competition from alternative accommodations.
10. Agriculture: Agricultural businesses can fail due to weather-related disasters, fluctuating commodity prices, and changing government policies.
2. Food and beverage: Restaurants and food businesses often struggle with high overhead costs, seasonality, and stiff competition.
3. Construction: Construction companies can fail due to economic downturns, project delays, and cost overruns.
4. Real estate: Real estate businesses are vulnerable to market fluctuations, changing interest rates, and regulatory changes.
5. Manufacturing: Manufacturing businesses can fail due to supply chain disruptions, rising production costs, and changing consumer demands.
6. Technology: Technology companies face intense competition, rapid technological advancements, and high research and development costs.
7. Healthcare: Healthcare businesses can fail due to regulatory changes, rising costs, and changes in reimbursement policies.
8. Transportation and logistics: Transportation and logistics companies can fail due to rising fuel costs, regulatory changes, and increasing competition.
9. Hospitality: Hospitality businesses such as hotels and resorts can fail due to economic downturns, changing travel patterns, and competition from alternative accommodations.
10. Agriculture: Agricultural businesses can fail due to weather-related disasters, fluctuating commodity prices, and changing government policies.
How not to be a statistic
Small businesses often face numerous challenges, and a notable percentage fail due to specific shortcomings. Here's a breakdown of small business failure statistics related to marketing, contributed to by Melville Marketing Ltd.
- Poor Marketing: More than 14% of small businesses fail due to poor marketing
- Lack of Demand: Over 40% of small businesses fail because there is no market need for their products or services. Good marketing demands a thorough knowledge of the market place in which the business operates, if that marketplace is very small, non existent, or hard and expensive to reach, you dont have a business.
- Marketing Uncertainty: Almost half (46%) of small businesses are unsure if their marketing strategies are effective, and 17% know their strategies are not working.This is usually because firstly they dont have a marketing or business plan and secondly, they rarely if ever conduct a SWOT and PEST analysis.
- Poor Planning: 78% of small businesses fail because they lack a well-developed business and marketing plan.
- Overall Failure Rates: Worldwide, 50% of small businesses fail within 5 years, and 66% fail within 10 years. Approximately 20% of new businesses fail during the first two years. In the UK approximately 34% of new businesses in the UK fail within the first two years of operation.
- Common reasons for startup failures in the UK include
Running out of cash (44% of failures)
Insufficient market research (58% of founders regretted not conducting more)
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- Cash Flow Problems: 82% of businesses that failed cited cash flow problems as a factor in their failure.
- No Differentiation: Businesses may fail if customers do not understand what makes them better than the competition, which is why businesses need a strong Unique Selling Proposition - USP
For further reading, see Real Marketing
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