Research indicates that 75 percent of startup businesses that have been funded by venture capitalists will fail, and a similar amount of small businesses will last no more than 10 years. Not being able to attract and keep enough customers to make a profit is a major factor in the majority of business failures. In fact, there are several customer-related mistakes owners make that contribute to the end of their businesses.
No matter how innovative a product may be, if it does not directly address the needs and wants of the desired customer, it will not be enough to keep the business afloat. In order to have the right product-market fit, it may be necessary to create a minimum viable product that is presented to a target audience who will be able to provide valuable customer feedback. The feedback should serve as a basis for modifications made to the product to make it market-ready.
The acquisition of new customers relies heavily on an effective sales team. If the sales people who interact with potential customers are not trained well or have poor knowledge of how the market works, obtaining new customers can be challenging.
Poor customer service is another common misstep. A study conducted by American Express revealed that individuals will inform 16 other individuals about an incident in which they received inadequate customer service. This can prevent a business from acquiring new customers from word-of-mouth recommendations.
An attorney who practices commercial law may protect the interests and rights of entrepreneurs during business transactions. The lawyer could help secure venture capital, review non-compete agreements, negotiate severance agreements, obtain appropriate business licenses, create the appropriate business entities and ensure compliance with regulatory law.