The main reasons for the closure of enterprises are as follows:
1, overall environment of the enterprise: the enterprise is an open system, and the overall environment affecting the enterprise must be considered; Enterprises should take these environments into account when formulating their own strategies. In the overall environment, the factors that may affect the performance of enterprises are the industry recession, the financial market is a bear market and so on.
2. Corporate policies: Corporate policies include strategy, investment, business, operation, financial and administrative policies, human resource management and corporate governance. Common types of business failures include: start-ups, blind growth companies (too ambitious or extremely fast expansion) and companies that are indifferent to environmental changes.
3. Interaction between enterprises and stakeholders: Enterprises must consider the interaction between enterprises and stakeholders: customers and competitors are very important. Other stakeholders (such as suppliers and banks) also have influence on the company.
4. Managers' attitude and negligence: the main mistake of managers of unsuccessful startups lies in their recklessness in the process of establishing companies; Overestimation of turnover has led to the deterioration of blind growth enterprises; Enterprise managers who are indifferent to the environment lack the necessary enthusiasm and determination.
5. The influence of managers and their management styles: managers are considered to be the most critical factor in the collapse of companies; The enthusiasm, quality and management skills of managers will affect the way managers manage companies. Lack of management skills and inappropriate management methods are the reasons for the bankruptcy of many companies. Not only the quality and management skills of managers will affect the survival opportunities of companies. There are many managers' personality characteristics that strongly affect the company's performance; Managers take less risks than entrepreneurs to some extent, but this does not mean that companies led by managers can formulate safer strategies.
6. The industry in which the enterprise is located, the history and scale of the enterprise itself: young companies must establish stable communication relations with customers, creditors, suppliers and other organizations in a timely manner; The size of the organization will also affect the company's chances of survival; Even if the financial situation of companies in different industries is the same, the bankruptcy probability may be different. In addition, there is contagion effect between the same industries. There is a close relationship among company characteristics, company managers and company policies.