Question

why would 50% of businesses fail within the five years? Lack of capital for running the company, not enough profit to pay all the expenses, poor management skills, all of the above?

Answer 1

The answer is: all of the above

The disadvantage of small business ownership is that fifty per cent of all new businesses are unsuccessful within the first five years. The main reasons are undercapitalization, which happens when the company does not have sufficient funds to perform ordinary business operations; directorial inexperience or incompetence, as well as lack of ability to cope with growth.