Ryan Madison is thinking about closing his vending machine business in Waterloo, Iowa. "I've got a family to support," Madison told the Waterloo-Cedar Falls Courier. "I hate to start talking about that, but maybe I'm going to be working for somebody for the rest of my life....I've come to the realization, maybe I'm just dreaming."
According to the newspaper, Madison's company, Arquel Vending, owns about 100 vending machines. The machines take in as little as $6 a month and as much as $100 in income. Madison places, stocks, and repairs the machines himself. He markets his company primarily to black-owned businesses and to local companies. The business is breaking even but Madison has had to take on a part time job to support his family.
Several times, Madison has reached out to Mike Hahn, of the University of Northern Iowa's Regional Business Center in Waterloo, for advice. Hahn told the paper that most businesses failed for the following reasons (I'm quoting here):
'¢ "Not having a well-developed business plan"
'¢ "Overly optimistic about sales and money needed"
'¢ "Entrepreneurs don't recognize or acknowledge their weaknesses, and don't seek help in those areas"
'¢ "Poor at handling or understanding cash flow"
'¢ "Starting out with too little money"
'¢ "Improperly pricing product or service"
'¢ "Poorly marketing the business"
'¢ "Not understanding or ignoring the competition"
'¢ "Focusing or relying too much on one customer"
'¢ "Hiring the wrong people"
'¢ "Micromanaging, or not being able to successfully delegate tasks to employees"
What do you think? Should Madison close down his company? If not, what steps should Madison take to make his business more successful?
And what do you think of Hahn's list? Would you add anything to it? Do you disagree with any of the reasons he's listed?
Last updated: Jul 16, 2007
MIKE HOFMAN was previously editor of Inc.com and a deputy editor at Inc. magazine, which he joined in 1996. The site was nominated for a National Magazine Award for Digital Media in 2010, and was named the best business website by Folio Magazine. In 2006, Hofman was part of a team of writers nominated for a Webby Award for best business blog. He lives in New York City. @mikehofman