Do you own a salon or are you owning the business?

There are confronting statistics on the longevity of new small businesses. A recent survey by CB Insights reveals:

23% fail because they don’t have the right team running the business
18% fail due to pricing and cost issues
17% fail from a lack of a business model or poor product offering, and
14% fail because of poor marketing and ignoring their clients.

The University of Technology, Sydney, provide time frames around the survival rate of new Australian businesses with 30% folding within the first year, 50% close at year 2 and 75% close within their first 5 years of business.

Of course, we all enter into business ownership with the intention of being the top 25% that survive well past their first 5 years, and to have this business, it’s important to understand your role in this.

The question you need to ask yourself is, did you buy a salon, or are you owning a business?

These are two very different concepts that will inevitably have two very different outcomes.

Owning a business, you become responsible for its function, efficiency, team building, growth and culture, and be the person responsible and accountable for both any success and any failure.

Ask any successful business owner and they will tell you that while celebrating business success is incredibly rewarding, owning business failure can be confronting and challenging, but assessing the situation points you to positive learnings that will help your business not only survive, but continue to grow.

Being frank, honest and calm in these times is important to help you understand what has happened and how to navigate your business forward in a sustainable way. There are no quick fixes, it is a journey and will take time.