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What are the major reasons for small business failure?

Answer: 

In his book Small Business Management (published by West Publishing Co.), Michael Ames gives us the following reasons for small business failure:

  • Lack of experience
  • Insufficient capital (money)
  • Poor location
  • Poor inventory management
  • Over-investment in fixed assets
  • Poor credit arrangement management
  • Personal use of business funds
  • Unexpected growth

Gustav Berle in The Do It Yourself Business Book (published by Wiley Co.) adds two more reasons to Michael Ames' list:

  • Competition
  • Low Sales