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5 Businesses with a High Failure Rate

5 Businesses with a High Failure Rate

Posted On
September 2

Before starting a business it is imperative to complete the appropriate amount of research. This will help you pinpoint the best opportunities, while avoiding those that are fraught with peril.

While some businesses have a high success rate, others check in at the opposite end of the spectrum. These businesses are difficult to start and even more challenging to keep up and running.

You can still get involved with a business that has a high failure rate, but make sure you know what you are getting into from the start.

Here are five business ideas that have scared many people away:

  1. Local trucking. There is one word that describes why this is a high failure rate business: competition. With so much competition, both from large companies and small contractors, it can be extremely difficult to grab any meaningful market share.
  2. Restaurant. At some point, most people think about what it would be like to open a restaurant. And most people realize it is not for them. There is a lot of money to be made, but competition is fierce, margins are slim, and the failure rate is extremely high. There are so also some specific requirements when running a payroll for a restaurant.
  3. Grocery store. Sounds like a great idea, right? People need groceries, and your store will supply them with everything on their shopping list. The main issue with this business is the inability to compete with large chains. These stores have the ability to purchase and sell goods at lower prices, meaning they will attract the largest audience.
  4. Home building. Everybody needs somewhere to live. Furthermore, most people dream of building their own home. Even with a high level of knowledge and expertise, this business is a big risk. Not only are you tied into the housing market in general, but there is no leeway when it comes to providing high quality craftsmanship.
  5. HVAC. Drive through your city and you are sure to see plenty of HVAC trucks on the road. There is no denying that homeowners (among others) hire HVAC professionals on a regular basis. The issue is this: competition is extremely high and most people don’t want to make a change from their “guy.”

There are thousands of business ideas to choose from. These five may sound exciting and rewarding, but the failure rate is high. That could mean the rewards are also rich? Are you willing to take the risk?


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