What Popular Entrepreneurship Failures Can Teach You About Business
An Examination of 7 Failed Businesses (and What Went Wrong)
Every day, there are thousands of business failure stories. This is a sad but true fact: most startups cannot compete with what is already available.
In this blog, we will discuss seven famous startup case studies where businesses failed due to poor management, bad business practices, and changes in industry conditions.
#1: Polaroid
Polaroid was best known for its Polaroid instant film and cameras. The company was founded in 1937 by Edwin H. Land and Laurens Van Dam, who invented a process that allowed the use of an organic compound to create a negative image on light-sensitive paper.
In the early days of Polaroid, Land and Van Dam sold their first camera kits through mail-order catalogs. They soon expanded into retail stores, where they sold cameras and film in addition to other products such as flashlights and sunglasses.
Polaroid continued to expand its product line over the years until it became one of the most recognizable brands in consumer electronics history.
What Went Wrong:
Despite its success and popularity among consumers, Polaroid did not invest in developing new products or technology that could help it stay relevant in an ever-changing industry landscape.
#2: Blockbuster
Blockbuster was founded in 1985 and went on to become a household name in the industry, with over 1,200 stores nationwide.
What Went Wrong:
The company’s downfall came when it failed to adapt to new technologies, such as streaming services like Netflix and Hulu. This led to a decline in sales for Blockbuster as well as a decrease in customer loyalty.
#3: Toys “R” Us
Toys “R” Us was one of the leading toy stores in the world, with locations throughout the United States, Canada, and the rest of the world. It is one of the most popular toy chains, even today.
What Went Wrong:
As a result, the company has been unable to capitalize on the growth of e-commerce and is now in danger of being undercut by competitors who have already taken advantage of the opportunities presented by Amazon.
It’s not that they didn’t see the writing on the wall. They just didn’t want to lose their stores, so they kept relying on their competitors to do it for them.
They also didn’t realize how much customers would love their brand if they were able to buy toys online and have them shipped straight to their door.
#4: Tower Records
Tower Records was a pioneering force in the retail music industry.
When it opened its doors, Tower Records was the first to create the concept of a retail music megastore. With locations across the country, Tower Records was able to offer customers a wide variety of music at affordable prices, and it became an instant success.
The store’s location in Los Angeles made it a popular destination for music lovers from all over the world, and its iconic logo became synonymous with an exciting new era in music discovery.
What Went Wrong:
The company had a strong presence in the music industry, but it was not long before digital disruptions such as iTunes, Spotify, music piracy, and other streaming businesses began to take their toll on Tower Records’ business model.
They had a poor grasp of the emerging technology of data analytics, which allowed them to spot trends in the industry that would have otherwise gone unnoticed.
#5: Kodak
Kodak was a leader in the photography industry. The company’s products were designed to be simple and easy to use, but also durable and reliable.
Kodak’s early products were very innovative in design, with features such as removable film canisters and interchangeable lenses. These early innovations helped make Kodak a leader in the field of photography.
What Went Wrong:
Kodak’s downfall began with the introduction of digital photography. The new technology allowed photographers to take better pictures than ever before without having to pay for film processing or developing their photos.
This led many people who were once loyal customers of Kodak to switch over to using digital cameras instead—and they weren’t alone!
#6: General Motors
General Motors had an incredible amount of power during its time as a major player in American business. Their cars were incredibly reliable, which helped them sell more vehicles than any other car manufacturer in history.
General Motors’ vision was for GM to produce affordable cars for middle-class families. He believed that if he could make these cars, everyone would want them and he would be able to sell them at a reasonable price.
What Went Wrong:
To compete with other car companies, GM needed to be able to keep up with them in terms of technology and design. However, it didn’t do this well enough or quickly enough, which resulted in the company falling behind its competitors and eventually going out of business.
If you’re not innovating, your competitors will continue to do so—and if you don’t have any competition at all, then you’re guaranteed success.
#7: Compaq
Compaq became a major player in the PC market by introducing a line of computers with unique features that appealed to consumers’ needs.
For example, Compaq’s computers had better graphics than other brands’ products did at that time. The company also offered a wide range of models that were affordable for customers on a budget but still offered high-quality features.
What Went Wrong:
Compaq’s prices were too high for its market share, and it could not compete with Apple’s or Dell’s low-cost computers.
It eventually merged with Hewlett-Packard Company in 2002 after failing to keep up with rising prices for computer parts due to increased demand from consumers worldwide for new technologies such as touchscreen technology and Blu-ray discs.
Frequently Asked Questions
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What’s the most common cause of business failure?
Sometimes it’s because they don’t have the resources to succeed. Sometimes it’s because they’re just not good at what they do. And sometimes it’s because other factors at play make it impossible for them to thrive in their current environment.
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When a business failure takes place, what happens?
All of the assets owned by that company become unavailable for use by other people—that means everything from cash flow statements and inventory records to customer lists and employee files will be gone forever.
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What should I do if my business fails?
You can’t just shrug off the failure and move on; you have to take responsibility for what went wrong and then figure out how to fix it.
You’ll need help from experts to do this effectively, but it’s not an impossible task—just remember that failure isn’t the end of the world!
Conclusion
When a business fails, it can be a huge blow to the owner’s pride and self-esteem. If you’ve ever been in this situation, you know how hard it can be to face up to what happened and start over.
But there are ways for you to recover from failure:
- Accept that it happened and move on. There is no going back and changing what happened so don’t try to do so!
- Take some time off from work to focus on yourself and figure out what went wrong with your business; this will allow you to come back stronger than before.
- When you get back into the swing of things again, make sure that everything is being done right at every level of your business so that nothing like this ever happens again!
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