There are numerous studies regarding small-business failure rates. Unfortunately, the findings are often vague because, unlike publicly held corporations, most private companies do not report their financial results. One thing is for sure, businesses fail in large numbers, especially small ones:
According to a September 2009 “U.S. Small Business Administration Office of Advocacy Report” in 2008; there were 627,200 new businesses, 595,600 business closures and 43,546 bankruptcies.
A major culprit as of why businesses fail, covered in detail in the book “E Myth” by Michael E. Gerber, is because business owners neglect to put systems in place. The owner-manager has a tendency to work IN her business, rather than ON her business. With the advent of technology, this trend has increased exponentially, especially for those companies who do not adapt to the rapid changes taking place in the business world.
To put it succinctly, business owners who fail to adapt, still run their companies based on the Industrial Age business model, rather than the new the Information Age and Knowledge Era. This is a major conflict and speeds up the business failure because if you talked in today’s terms, it would be like using telex machines and telegraphs to conduct day-to-day operations.
The solution is then to bring these existing businesses, or create new startups using new age solutions. This means building a business using efficient and inexpensive, sometimes even free, cutting-edge technology readily available for the savvy business owners who is ready to adapt and move their existing or new business ventures into the Information Age and Knowledge Era.
Without a doubt, businesses who have adapted have seen huge leaps in progress and efficiencies based on technology. Over the past decade, technology has helped entrepreneurs leverage their time, create process efficiencies, reduce costs massively, and allowed them to maximize business profits to levels never seen before.
To date, most of these major technological overhauls have taken place in big corporations with deep pockets. What better proof than to see how their stock values keep raising, even though the rest of the population is seeing one of the worst economic crisis this country has ever seen.
The question is then, how do we get small business owners, home based business and new incoming entrepreneurs to embrace and take advantage of the endless benefits technology offers? The answer lies in converting these small business ventures, into virtual businesses. Technology, without a doubt, has changed the playing field and has allowed smaller companies to compete with larger corporations on the same level.
In this new economy, it is no longer the big one, but the fast one that wins!
A virtual business allows a company to be geographically dispersed. It allows it to meet and support its customers wherever they are located. Employees are no longer constrained to a physical office, but instead, they can work from anywhere, at any time, at any pace; all accessible, networked and coordinated via internet applications.
As you can see, with a virtual business, all you need is a computer and internet access to get you going. Anyone can start a virtual business in minutes. You don’t need major start up capital. You don’t need investors. You don’t need to risk months or years trying to break even. You don’t even have to gamble your savings. You can implement sophisticated systems. You can hire the most qualified personnel from anywhere in the world. Most importantly, a virtual business allows you the free time to have a personal life too!