I feel I should have published this blog back in 2009 when we started, because every time a business closes, the response on Facebook is always the same:
“I didn’t know it was there. They mustn’t have done enough marketing.”
Granted, sometimes that is true. They haven’t done enough marketing. There are businesses that open in town. They don’t reach out to people like us with a large local audience; they don’t post on social media consistently; they don’t attend networking meetings; their website is non-existent or out of date; they’ve never sent a press release; they’ve never had a launch event. Those business owners are entirely responsible for their lack of success.
But it also happens for businesses on the busiest streets in town who do brilliant marketing, sales are flowing, and they have a large customer base.
And then they close.
And everybody wonders why.
Here are some of the reasons Why Businesses Close: Factors Beyond Sales and Marketing
Stress
If we’re honest, every business owner wakes up worried about what the day will bring.
Running a business is never easy, and not everyone is cut out for it.
The advice that everyone follows their passion is just misguided nonsense, and for some, simply enjoying their passion and not trying to turn it into a business is the best thing they could do.
Take the last 5 years alone.
The pandemic, cost of living crisis, half a dozen changes in prime ministers, a country on its knees, the threat or possibilities of AI.
Those are all external stress points, and that’s before you even look at direct stress points like staff, clients, increased competition.
15 years into a business, the stress never goes, but I’ve learnt to go with the flow and realise the good will out if I direct my energy in the right places.
Work / Life Balance
Most of my close friends work 9-5.
They freely admit that they wouldn’t swap positions with me regardless of the financials.
They like the fact they truly switch off at 5pm and at weekends.
They like the fact that on holiday they don’t have to have those 10 minutes in the morning and evening to check emails, WhatsApp, and social media.
Sometimes a business closes as the person simply doesn’t want to work at 7am or 10pm or on a Bank Holiday Monday just to catch up.
Change In Personal Situation
Elderly Parents. Young Children. Serious Illness.
All scenarios where someone may feel it’s better to sell or walk away from a business.
There are so many business owners I know right now that are balancing being a carer with running a business.
For a time it’s a struggle, but manageable.
But for many, there comes a time where they have to walk away to look after loved ones.
Relocation
I’m lucky that if I wanted to move to Spain or live in a caravan in Wales, I can run elements of my business online.
At the start of the pandemic, I stated that 80% of my social media training would be online after the pandemic ends.
It’s not worked out that way with the push back to face-to-face, but I could easily pivot if I wanted to.
For a bricks and mortar businesses, relocation outside of the area is often a reason for a business closing.
Rent / Rates / Cost Increases
A massive bugbear of all people involved in supporting local businesses.
The nightmare of increased rents.
Business is business, and landlords are businesses as well, but if we’re entirely honest, a lot of them take advantage.
Business owners should budget for known increases such as costs going up after the first 6 months reduced rent – that’s just common sense.
But when rents double or triple on rent reviews because the pavement outside looks a little nicer with a bench and a tree outside, it really is unsustainable.
So many successful businesses close because of landlord greed.
Losing Key Man
It’s sad, but I’ve seen this before.
In fact, this happened to one of our clients.
When they had the right people on board, everything was going well. Great communication. Great partnerships with businesses like ours. We literally drove a £15,000 order within 24 hours of working with them.
And then that key person left as they wanted to pursue other career goals.
Their replacement was shocking. Domineering, in your face, and not a people person.
Our relationship with the business owner broke down. We walked away. So many clients walked away from them.
The business was sold less than 12 months after one key person leaving.
Cash Flow
It’s devastating when this happens, but it shows why you should never have a business that relies on 1 or 2 clients.
Businesses can be profitable, but cash flow issues prove to be the fatal blow.
When those clients who have been loyal for years start extending their payment terms or just simply not paying, it can prove problematic.
Those unpaid bills of £5,000-£10,000 can be the difference between you defaulting on your suppliers.
Lost The Passion
This was why I gave up my previous live music events business.
It was profitable, and yet I closed down the business.
People are always surprised that I still go to 80+ gigs a year but walked away from working in the music industry.
Back in 2013, I was falling out of love with music and my social media business was growing.
Every event promoter in Manchester was seeing last-minute cancellations from bands, and it was becoming a chore.
I had a choice to make – if I kept working in music, I’d stop loving music, or I could walk away, grow my social media business, spend weekends with friends, and then rediscover my love for music again.
It was the best decision I made.
And if I fell out of love with social media, I’d do the same again with social media marketing.
New Business Idea
As a business owner, I have way too many ideas for businesses.
I just wish I had the time.
Back in 2019, I wanted to set up a running business.
I went as far as paying for a website designer and I had big plans.
And then the pandemic happened, and the world went to chaos.
Looking around in 2025 and the popularity of running, I perhaps should have kept at it.
But often pursuing a new dream or idea is the reason why businesses close.
They have a greater calling.
CHANGING THE NARRATIVE ON BUSINESS FAILURES
Stats say that 80% of businesses will fail in 3-5 years.
The average job tenure in the UK, or the length of time someone stays with a single employer, is typically around 2-4 years.
We don’t say an employee who moves on from a job has failed.
Perhaps we shouldn’t always use the word failure as regards businesses as there are so many variables as to why businesses close.
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Please call Alex on 07806774279 or email alex@altrinchamhq.co.uk
