Furthermore, specific factors affecting probability for a firm to fail identified (Storey, 1994b). These are businesssize, age, property, activity sector, former performance, personnel, geographical location, business type, macroeconomic environment, government funding (subsidies) and some other reasons.
It is commonplace for researchers that failure is closer in the early years of businesses and in particular
immediately after their launch, with failure rates ranging between 50 and 80% in first five years of their life.
Business failure factors divided into two categories (Murphy, 1996): environmental factors and symptoms of
management disability. Apart from environmental factors, there are three categories of failures mentioned:
functional knowledge, managerial skills and managerial behaviour.