There are exactly two ways to get rich

[Igel]

60. "Business plan."

The few small businesses I've been involved with or exposed to have crashed and burned.

They had crappy business plans. Products that they believed everybody would want but had no basis in fact for their belief. Belief that they'd start raking in the money before the owners' nest eggs ran out and with no means to keep the cash flow going.

One common problem was making something that was very much a niche product. They had actually pretty much met all the demand in most of the country but misread the signals. Rather than thinking that flatlined demand was a consequence of, well, demand, they decided that it had to be lack of publicity or lack of supply. So they ramped up production and had a huge stock that didn't move. Taps for them.

One decided to "leverage" its suppliers' output of a particular material and go into clothing. Ignorance killed them, as size 2 dresses were marketed as size 6 and size 8 dresses were marketed as size 14. They fixed this problem the same season as they decided to increase production by a factor of 10, confusing the buying surge from being novel with a sustained demand. Taps in 6 months.

Cash flow could have sustained most of them, allowing them time to clear out their stockpiles and right-size. Or expertise would have told them to aim low because barring a miracle, they'd never have a large market.