Disadvantages of Small Business
- Risk of Failure
small businesses run a heavy risk of going out of business - about 50 percent survive at least five years. Older, well-established small firms can be hit hard by a business recession
- Limited Potential
The owner may have some technical skill - as a hair stylist or electrician, for example - and may have started a business to put this skill to work. Such a business is unlikely to grow into big business.
- Limited Ability to Raise Capital
Most small-business financing comes out of the owner’s pocket.