On average, 4.5 million new businesses are created in the US every year. 900,000 of them will fail within one year. Another 1.3 million will fail by year five, and other 675,000 will fail by year 10. 65% of all new business will fail in the first 10 years. 

Using those stats indicates that between 25 and 30 million businesses are in the dead zone and will not survive the 10-year mark. The sad part is that many business owners may not know it. 

Now, we understand year 1 failures completely. Many just didn't have the cash required to extend to profitability, others promoted a product that had a poor market fit, and still others didn't really know their customer. Our micro learning series for Entrepreneurs could have fixed most. 

So let's say you own one of the businesses that lasted a year. What early warning signals should you be looking for, that would indicate potential oncoming disaster?

Three words.... FAILURE TO GROW. That's it, if you can't grow, you are in the dead zone. All too often, owners blame something else... recession, competition, inflation. While external conditions can be challenging, you must look inward first. 

Business Health requires an honest analysis and acceptance of root causes, wherever they lie. While the SWOT analysis is very good tool, we've developed a technique that is more direct for spotting specific growth issues.  We call it the 6 Ps of Business Health.

For each of these, you need to answer the question "Why aren't we growing?" Here they are:

1. Product - Do we have the right products? Do competitors have better products? What do our customers say? If our product is the right product, then it must be something else.
2. Price - Do we have the right price? Is it competitive in the marketplace? Do we communicate our USP to justify the price? So, what is it that keeps us from growing?
3. Process - Is it our process? Is our product reliable? Do we deliver on time? Is uninterrupted supply an issue?  What do our customers say about our process? Hum, what then?
4. People - Is it our people? Are we not listening to what the market is telling us? Can we attract more productive salespeople? Are incentives aligned with goals? Is someone in our camp stifling our growth? Solicit reasons, not blame. (Blame comes later)
5. Presence - Do all potential customers know about us and our products? Do we need to rebrand, build our brand, change advertising and marketing methods? Promote more?
6. Performance - Do we expect a high level of performance? You will not get it, if you don't expect it.  All companies must establish SMART goals. 

I'm going to venture to say that 90% of growth problems lie in the 6 P's. 

You must analyze the 6 Ps in a group setting, enlisting the input of all stakeholders. The analysis should not be led by the founder. They would be a participant, like everyone else. Encourage open, non-judgmental communication. "Everyone gets a pass here; we just want to look at our business honestly."

This will be an empowering experience for your company and your people. It will foster cooperation and shared purpose. 

We suggest subscribing to our micro learning series for entrepreneurs, where we present bit-sized business best practices that should be adopted by all companies, regardless of size or profitability. Implementing best practices can only make your company better. The cost of doing it is small, the cost of not doing it is...

Jeff Richards
Think Deep Global 
www.thinkdeepglobal.com