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CEO Advisor® Newsletter
February 2012
7 Reasons Why Small Businesses Fail 

Why small businesses fail is one of the most least 
understood aspects of business. I have started and sold companies, ran businesses, advised many business owners, as well as, advised on mergers and acquisitions so I have a lot of experience growing small businesses to the next level. 


The reasons for failure cited by the business owners are frequently inaccurate, which makes sense when you think about it. If business owners really knew what they were doing wrong, they might have been able to fix the problem. Often, it's a matter of denial or of not knowing what you don't know. 


Here are 7 reasons why businesses fail: 

  1. Demand and Market Size: There is not enough demand for the product or service at a price that will produce a profit for the company. This, for example, would include a start-up trying to compete in a very competitive market, or a company chasing a very small or declining market. 
  2. Business Owners on Auto-Pilot: They may be stubborn, risk averse, or conflict averse - meaning they need to be liked by everyone. They may be perfectionist, greedy, self-righteous, paranoid, indignant or insecure. You get the idea. Sometimes, these CEOs and business owners realize the problem but continue to make the same mistakes over and over, as well as, decline to get the needed help. 
  3. Poor Accounting, Lack of Knowledge of Financials: You cannot be in control of a business if you don't know the business from a financial perspective. With bad numbers, or no numbers, a company is flying blind, and it happens all of the time. Why? For one thing, it is a common - and disastrous - misconception that an outside accounting firm hired primarily to do the taxes will keep watch over the business. In reality, that is the job of the CEO/business owner, one of the many hats an entrepreneur has to wear. 
  4. Lack of Cash: If we have learned anything from this recession, it's that business is cyclical and that bad things can and will happen over time - the loss of an important customer or critical employee, the arrival of a new competitor, the filing of a lawsuit. These things can all stress the finances of a company. If that company is already low on cash (and borrowing), it may not be able to recover. 
  5. Management: Lack of strategy, focus, vision, planning, forecasting, reporting, accountability and everything else that goes into good management.  The key to success and profits is to properly manage your company and this is no easy feat. 
  6. Out-of-control Growth: This one might be the saddest of all reasons for failure - a successful business that is ruined by over-expansion and management miscalculations. This would include moving into markets that are not as profitable, focusing on less profitable products and services, experiencing growing pains that damage the business, or borrowing too much money in an attempt to keep growth at a particular rate. 
  7. Lack of Growth: On the other hand, CEOs and business owners need to fuel well-planned growth on a consistent basis - both organic growth and small opportunistic acquisitions of competitors and complimentary products and services. A properly managed sales team, along with a marketing plan executed on a consistent basis is critical to your business, and your business will suffer greatly without both.

CEO Advisor, Inc. can help you overcome these hurdles. We work with CEOs and small business owners to generate profitable growth. Contact us today for a free consultation by calling (949) 759-8676 or emailing us at


CEO Advisor, Inc., the leader in growing small businesses to the next level, will hold a FREE Business Growth Seminar exclusively for CEOs, Presidents and business owners at our Newport Beach office. 


This event is limited to 10 business owners and will cover critical areas of business growth to drive your sales and profits. All small business owners and CEOs who are committed to growing your business to the next level should take advantage of this tremendous opportunity.


A $100 gift certificate to the Pelican Hill Resort will be awarded to one lucky attendee. A $250 rebate will be offered on business advisory services to all seminar attendees who sign-up by February 29th.


Register Now


Location: 23 Corporate Plaza, Suite 150, Newport Beach, CA


Date: Wednesday, Feb. 15, 2012


Time: 1:30 - 3:30


Presenter: Mark Hartsell, MBA, CEO/President CEO Advisor, Inc.


Wine and dessert to be served


Free Parking


For CEOs, Presidents and Business Owners Only


Registration required. No Walk-ins, Vendors or Service Providers


Register Now or call us at (949) 759-8676


"As a President of a mid-size technology company, I have been very pleased with the services provided by CEO Advisor®. He contributed in many areas, but identified marketing and sales as our primary need. His guidance and contributions have been invaluable in establishing and maintaining a meaningful marketing and sales program for the company. He is a knowledgeable business advisor and a pleasure to work with."
CEO/President, Engineering Services/Manufacturing Company

"The CEO Advisor Program is a great way to gain a CEO Advisor® and be part of a dynamic process. What I realized the most after taking on the services of CEO Advisor, Inc. was that just because I knew my industry inside and out did not mean I knew how to grow my business profitably.  Before I hired CEO Advisor I was growing my business, but not seeing any more money in my pocket. It almost seemed like I was running in place. My CEO Advisor® helped me lay a foundation and create an immediate path to profitability. In a matter of months I was seeing an incredible velocity take place in my business. I was able to explore opportunities that I never even dreamed of. 

I can't believe how much money I was leaving on the table before CEO Advisor, Inc. He showed me how to capture a lot more profit without expending more man-hours and capital. The most exciting part is that I now have a very specific plan and forecast of my company's future. It looks very bright indeed.  

Thank you!"

CEO, Web Services Company

"Mark Hartsell and CEO Advisor, Inc. provide a unique advisory service for CEOs. He not only tackles high level strategic issues to assist CEOs navigate through challenging times, but Mark also gets very involved in actually addressing important issues head-on by performing the work to achieve tangible results.

Whether it is growing a business to the next level, turning a distressed company around or preparing a company for an exit, Mark's firm, CEO Advisor, Inc, provides a broad range of services and Mark is there for the CEO every step of the way."



Haynes & Boone, LLP

Words of Wisdom

"Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion." 

Jack Welch 

Businessman, Author

"Yesterday does not equal tomorrow. Forget the past and move towards your goals."

Tony Robbins
Motivational Speaker

"Yesterday does not equal tomorrow. Forget the past and move towards your goals."
Tony Robbins
Motivational Speaker
"Yesterday does not equal tomorrow. Forget the past and move towards your goals."
Tony Robbins
Motivational Speaker

Prime Minister of the U.K.