2.2 Lack of business skill

Getting paid and bad debts/lack of capital/lack of liquidity

Described image
Figure 6  Chained to debt

Getting the work is one thing, getting paid for it at a suitable rate for the time spent is another. The ability to negotiate a contract and then collect the money owed is an essential business skill. Not balancing the payments and income correctly could lead to cash flow problems. Insufficient cash to pay debts is the main reason small businesses fail.

Poor management

Described image
Figure 7  Poor managers rule by fear

Even in a micro business with no employees there needs to be a level of management, planning and reviewing of the business strategy. Setting unrealistic goals or plans falls into this category.

2.1 Lack of preparation

2.3 Poor choices