The 40 Biggest Problems & Mistakes That Will Crash Many Businesses in 2026, And How To Fix Them

Why do businesses suddenly crash and close down?

In the last 20 years, I have seen and experienced several businesses die. Some happened suddenly, and some died slowly, over time.

Losing a business can be a traumatic experience. After months and years of hard work, financial sacrifice, and high expectations, shutting down a business can be a painful and personal loss.

Many people in this situation struggle with unpaid business debts, a deep sense of failure, strained relationships with investors and business partners, and mental health issues.

Unfortunately, in 2026, more businesses will close down across Nigeria and Africa.

Some of those businesses will be strangled by external forces like the economy, stiff competition, and government policies.

However, most of the businesses that crash in 2026 will be due to internal crisis and self-sabotage.

The owners of those businesses will make bad decisions, delay important moves, waste opportunities and resources, ignore critical risks, and be unable to overcome major problems that confront their businesses in 2026.

The information you're about to read exposes the 40 most serious problems and mistakes that will cause businesses to crash in 2026.

They are the result of hard experience and a survey of over 100 African business owners in our community who have a dying business or have already lost one or more businesses.

By understanding these deadly problems and mistakes, you can prepare and position your business to survive and thrive in 2026.

In no particular order, I present to you the 40 major problems and mistakes to avoid, resolve, and overcome this year.

1/40. Running out of cash

Profit is good, but cash is king. Even if your business is profitable, it can still run out of cash and crash.

Many businesses, including profitable ones, will close down this year because they won’t have enough funds to cover rent, supplier payments, employee salaries, operating expenses, or bank loan repayments.

Unfortunately, most businesses that run out of money don’t see the problem until it’s too late.

A business that will soon run out of money may not look like it. It may have a full warehouse of products, and own buildings, machines, and vehicles. But what it lacks is the raw, liquid cash to pay bills and keep the business running.

Due to desperation, some businesses in this condition take expensive emergency loans that wipe out profits and worsen the original cash situation.

Some businesses that run out of money are forced to quickly sell off their stock or assets at a steep discount to raise cash. Sadly, the loss of critical assets further reduces the operating ability of the business and decreases its capacity to generate cash.

But what makes a business “suddenly” run out of money? 

There are several reasons.

Poor cash flow planning, overspending, weak pricing strategy, inability to raise additional capital, slow payments by credit customers, internal theft and fraud, tying up too much capital in unsold inventory, and insufficient sales are just some of the top reasons businesses run out of money.

And how can you avoid the problem of suddenly running out of cash in 2026?

2/40. Poor leadership and a toxic workplace culture

Our survey shows that poor leadership and a toxic workplace culture are 10 times more likely to cause employees to quit your company than a low salary alone.

The success of any business is closely tied to the quality of leadership at the top. 

Poor leaders frequently make bad decisions, freeze in the face of crisis, lack focus and change direction too frequently, and drain the resources of the business.

However, the biggest damage of poor leadership is how it infects the culture of a business and makes it toxic.

A toxic workplace culture is an environment that is full of negativity, fear, stress, and unfairness. It’s a place where the leader constantly uses bullying, gaslighting, or micromanagement to control employees.

As a result, employees are afraid to speak up, ask questions, or admit to mistakes because of fear of being mocked, screamed at, or punished by their leaders.

Worse still, a toxic culture mostly recognises, rewards, and promotes people who are “loyal” to the boss, rather than the employees who actually do the work and get results. 

Also, because poor leaders often rely on “divide and conquer” tactics, a toxic workplace culture encourages gossip, cliques, pretence, and backstabbing more than teamwork.

Sadly, it’s not uncommon for staff morale and productivity to drop drastically under poor leadership and toxic cultures, and good employees are more likely to quit.

Unfortunately, this situation usually leads to the slow death of businesses. While the business owner may blame low sales, competition, or incompetent staff for the failure of the business, the root cause is poor leadership and a toxic culture.

So, how do successful businesses ensure strong leadership and identify the warning signs of a toxic culture before it causes serious damage to their business in 2026?

3/40. Weak sales and insufficient revenues

This is one of the most common ways that businesses crash, especially new startups and young businesses.

A business with low sales and revenues usually faces a cash flow crisis. It doesn’t have enough cash inflows to cover important expenses like supplier payments, salaries, rent, inventory, and loan repayments.

Unfortunately, many businesses in this situation are forced to cut essential costs to survive. They might lay off key staff, stop spending on marketing, reduce the quality of their products and services, or delay payments to suppliers. 

All of these moves tend to worsen the situation.

While some businesses try to solve this problem by taking loans or raising capital from investors to support their cash needs, it doesn’t always work.

In the eyes of banks and investors, weak sales and low revenues make a business look “high-risk.” This makes it harder for the business to raise the money it desperately needs.

Until the underlying problems responsible for the low sales and insufficient revenues are fixed, the death of the business may be inevitable.

Businesses that offer irrelevant products, target the wrong market, have distribution and pricing issues, or face strong competition in saturated markets are more likely to struggle with weak sales and low revenues.

How can you fix the problem of weak sales and insufficient revenues in your business in 2026?

4/40. Growing the business too fast

Growth is good for business, but it can kill a business when it happens too fast.

When a business expands rapidly, its costs usually grow faster than its revenues.

Fast growth often means the business is making big bets and tying up funds in expansion activities, like buying more inventory, leasing a bigger office, investing in new machines and equipment, hiring more staff, doing aggressive marketing and branding, etc. 

However, as expenses grow and more cash flows out of the business, sales don’t happen instantly. As a result, there is a time gap between cash outflows and inflows.

Unless you have robust cash reserves or raise external capital, a business that grows too fast faces a high risk of suddenly running out of cash.

Also, fast growth introduces chaos, complexity, and high pressure to a business. Your current physical space (shop, factory, or warehouse), staff size, and internal processes may not cope with the higher levels of demand that come with rapid growth.

As the business owner struggles to maintain control over critical parts of the business, the operational chaos can lead to breakdowns in product quality, customer service, staff productivity, and the reputation of the business.

In summary, fast growth is not sustainable for most businesses. 

While the business may seem profitable on paper, rapid growth can quickly wipe out its cash reserves, as funds are tied up in fixed assets, unsold inventory, and receivables.

So, what is the best way to grow your business in 2026 and avoid the traps of growing too slow (stagnation) or growing too fast?

5/40. Absent or weak business structure and systems

Many businesses cannot grow beyond their current size and capacity because they lack the structure and systems that make growth possible and sustainable.

Let me explain “structure” and “systems”, so you understand why they’re critical to the long-term survival and success of any business.

Structure is about people, roles, and responsibilities. 

It defines the chain of command in your business: who makes decisions, who reports to whom, and who is responsible for specific areas like sales, inventory, operations, customer service, accounting, etc.

Without the right structure, the business becomes a “one-man show.” Without clear roles, employees always have to wait for instructions, and the business owner will bear the daily burden of making all decisions and doing most of the work.

Systems are about how work is done in the business. It covers all the repeatable ways to get things done in the business without the boss having to explain it every time.

Every healthy and growing business has a system for doing everything that keeps it competitive and successful.

There is a system for getting and serving customers (sales system), a system for recording and tracking financial flows (accounting system), a system for managing inventory (inventory system), a system for hiring employees (recruitment system), and more.

Without the right systems, your employees will always need guidance and struggle to do good work. There will be frequent delays, mistakes, losses, rework, and inconsistencies in the quality of your products and services.

In summary, without the right structure and systems in a business, it will struggle to stay organised, grow sales, satisfy its existing customers, and maintain its competitive advantage. 

In 2026, businesses with a weak structure and systems will continue to face a lot of stress, waste, leaks, and lost opportunities. 

How can you avoid this situation for your business this year?

6/40. Losing your customers to competitors.

Attracting new customers is important for every business. But what is far more crucial is keeping those customers so they regularly buy from your business.

Unfortunately, most business owners focus more on getting new customers than on deepening the relationship with existing customers. 

This neglect forces some of your customers to look for alternatives and switch to your competitors.

Holding on to your current customers is less costly, less competitive, and more profitable than acquiring new ones. New customers are harder to convert; they often require marketing costs, competition, and sales efforts to convert.

That’s why the loss of your existing customers to competitors should give you sleepless nights.

Many customers now have high expectations for speed, professional service, product quality, value for money, convenience, and more.

Therefore, if your business faces competition in 2026, the risk of losing your customers to other businesses is quite high if your customers believe they will be treated better elsewhere.

Unfortunately, losing customers is one of the fastest ways to kill a business. 

The business loses revenues and cash inflows, spends more on marketing to replace lost customers, gradually becomes unprofitable, and may suffer from negative word-of-mouth reviews by dissatisfied customers.

Losing customers to competitors can also damage the productivity and morale of your staff. As a result, several employees may quit their jobs, further reducing the ability of the business to attract, serve, and retain customers.

Why do customers leave? There are several reasons. 

The top triggers are a low perceived value for your product or service, poor customer service, and a lack of effort and incentives to retain customers.

So, how do successful businesses hold on to their customers, build loyalty, and keep them coming back for more?

7/40. Starting the wrong business

Many new businesses will fail in 2026 because the ideas they’re built on are not viable or feasible.

Viability is about market acceptance and commercial success. 

Will people want to buy the product at a price that is profitable for the business?

The problem is that many people start businesses with wrong assumptions about what the market wants, how much customers will pay and their willingness to pay, and the size and potential of the target market.

Feasibility is about execution and your ability to make the business work and succeed.

Unfortunately, many people with business ideas severely underestimate the amount of work, time, capital, resources, and relationships required to make a business succeed. 

Rather than focus on the viability and feasibility of their business ideas, most inexperienced entrepreneurs focus on raw passion, creativity, innovation, latest trends, or advanced technology.

Sadly, many people will waste their time, money, efforts, and expectations building the wrong business in 2026. They will burn through their capital, and the business will eventually run out of cash.

The biggest reasons for unviable and unfeasible business ideas are poor market research, unrealistic financial expectations and projections, a lack of strategy, ignoring the competition, an unclear business plan/model, underpricing or overpricing the product/service, and more.

How can you confirm that a business will be viable and feasible in 2026 before you invest your time, capital, and hopes in it?

8/40. Incompetent and poor-performing employees

Most businesses have to hire people to grow. As the business expands, the owner may no longer be able to do all the work and play all the roles.

Unfortunately, many businesses are being sabotaged by employees who either have a bad attitude toward work, don’t know how to do good work, or are unwilling to do their work.

Incompetent employees will cause your business to miss opportunities, lose sales, disappoint and push away customers to your competitors.

Because they can’t (or won’t) do good work, the quality of your products and customer service will suffer, and harm the brand and reputation of the business. 

Worse still, their poor judgement and actions will lead to errors, damages, rework, leaks, waste, and inefficiencies that amount to costly financial losses to your business.

Working with incompetent employees can also be incredibly frustrating and time-consuming. Many small business owners spend more time managing poorly-performing staff rather than focusing on running and growing the business.

There are several reasons businesses end up with incompetent and poor-performing employees.

The most common mistakes include rushing the recruitment process, weak pre-employment tests and interviews, hiring the wrong candidates, inadequate on-the-job training, and a lack of feedback and performance management systems.

So, how can your businesses attract, develop and retain competent and high-performance employees who will help to build and grow your business in 2026?

9/40. Disorganised business accounts and finances

Disorganised finances are a self-inflicted wound that will cause many promising and viable businesses to crash in 2026.

It creates dangerous confusion that prevents business owners from seeing the early warning signs of financial problems that will eventually take down the business.

When the accounts and financial records of a business are messy, it becomes impossible to know which products are profitable or where to cut costs, and leads to bad decisions and strategic errors that damage the business.

Disorganised finances also hide cash flow issues until the business runs out of money and can no longer pay suppliers, salaries, and other bills.

Worse still, even if your business is viable, disorganised records are a sign of incompetence that will repel banks and potential investors from extending loans and investments to your business.

Many businesses struggle with disorganised finances because they mix personal and business funds, lack a system for tracking sales and expenses, and rely on guesses and feelings rather than hard data to make financial decisions.

How do successful businesses organise their finances, and what can you do to keep proper and better financial records for your business in 2026?

10/40. A limited mindset and vision for the business

Many businesses will remain small and stagnant in 2026 because the owner’s limited mindset and vision act like a ceiling that holds down the potential of the business.

Many business owners don’t have a clear vision for their company. They are too busy with the volume of daily work and operations, and hardly think about the long-term direction or strategy for the business.

Without a clear purpose beyond making money, a business can be easily distracted by random opportunities and may target “everybody” as a customer. It cannot plan for long periods, and will struggle to motivate employees and properly allocate its resources.

In my observation, fear and resistance to change are the top limiting mindsets that hold back the performance and growth of many businesses.

A rigid mindset, fear of failure, and fear of embracing changes in the market can choke innovation, lead to poor decisions, delay important actions, and put the business at a disadvantage against more agile competitors.

How can you craft a powerful long-term vision for your business and overcome the limiting mindset that holds back the progress and potential of your company in 2026?

11/40. Starting a new business the wrong way

Many new businesses will crash in 2026, not because they don’t have potential, but because they were set up with the wrong foundation.

Poor startup strategy is responsible for a large number of new businesses that fail. The wrong strategy is like a broken compass that leads the business in the wrong direction and wastes its limited resources.

That’s why HOW you start a business in 2026 matters more than WHAT you start the business with. 

A new business with limited capital and a sound strategy will always defeat a similar business with lots of capital and a weak strategy.

There are several important and strategic decisions in the early days and months of a new business that can create serious complications later. 

Examples of strategic mistakes include the wrong choice of location, target customers, pricing, legal structure of the business, sales and production model, and the nature of suppliers, business partners and investors you choose.

Unfortunately, these decisions cannot be easily changed or reversed without negative financial implications for the business.

Also, financial mistakes like spending on the wrong priorities can waste the limited capital of a new business. 

Spending on vanities like expensive marketing (and branding), unnecessary product features, and sophisticated offices or websites can quickly make new businesses run out of money.

So, how can you reduce the costly mistakes that will make many new businesses crash in 2026?

12/40. Overspending and poor cost control

The quickest way to crash a business in 2026 is to spend more money than the business makes, or spend faster than the business makes money (without backup capital).

Unfortunately, many businesses fall into this "spending trap” without realising, until it’s too late.

At the heart of this problem is a lack of financial discipline and the absence of structure and systems for planning, monitoring, and controlling costs. 

Many businesses spend without a budget or a plan, and do not keep organised financial accounts that track how money enters and leaves the business.

Another common issue, particularly for new businesses, is spending too much on items and assets that tie up a lot of capital.

Rather than renting, leasing or buying second-hand assets, many new businesses overspend on expensive software, machines, vehicles, branding, buildings, and high-end office spaces.

Overspending on “aggressive” marketing is another major source of poor cost control. Without considering the potential return on marketing costs, some businesses spend more money to acquire customers than those customers will ever spend on the business.

Overestimating sales, revenues and growth can also lead to overspending and poor cost control.

Fired by overconfidence and unrealistic expectations, some business owners expand capacity, purchase excessive stock, and hire more staff than necessary. When actual revenue falls short, the business is left with large amounts of unsold inventory and high payroll costs it cannot meet.

So, how do successful businesses avoid the trap of overspending and ensure that their business costs are properly controlled?

13/40. Disengaged and unmotivated employees

Lack of motivation among staff is a virus that triggers a domino effect of poor performance that can eventually force a business to close down in 2026.

Employees who lack motivation are less productive; they operate at only 50-70% of their full performance potential.

Demotivated employees don’t take initiative at work, don’t have a sense of ownership, and have to be constantly instructed, reminded, and pushed around to do their work.

These employees do slower work, make more mistakes, miss opportunities and deadlines, frustrate customers, and lose sales. As a result, businesses with demotivated employees usually fall behind their competitors and lose customers to them.

Some of the warning signs of demotivated employees are mental and physical disengagement, frequent lateness, recurring absenteeism from work, reluctance to contribute ideas and opinions, and sudden resignations that can create shocks that harm the business.

But what causes employees to lose motivation?

There are several reasons, and it’s not just about salary and compensation alone. Increasing pay may temporarily improve motivation, but doesn’t always resolve the underlying problems.

The most common causes of demotivation are poor leadership and management, lack of recognition and growth opportunities at work, a toxic workplace culture, and unrealistic workloads that lead to stress and burnout.

So, how do successful companies keep their employees motivated so they do their best to run, build, and grow the business?

14/40. Stockouts: always running out of products for sale

A customer visited your store for the first time because her friend had spoken so highly of your business.

After placing her order, the response she got was, “I’m sorry, we don’t have these products in stock.”

In businesses like retail, up to 40% of lost sales are due to unavailable stock (stockouts). As a result of poor planning and several other reasons, many businesses suddenly realise they have run out of inventory.

When a business repeatedly cannot satisfy the needs and demands of its customers, it loses revenues and cash inflows, hurts its brand and reputation, and may permanently drive regular customers to competitors.

In fact, studies show that between 70-90% of customers who experience a stockout may never return to your business if they get a better experience elsewhere.

Unfortunately, many businesses are reactive to their inventory. They don’t know they’ve run out of stock until a customer asks for the unavailable product.

Repeated stockouts are not only embarrassing to your business, they are also costly. Stockouts lead to emergency stock purchases that cost more and eat into the profitability of the business.

What causes stockouts? 

The top reasons are poor inventory management, poor planning, inability to properly forecast demand, inaccurate or disorganised financial records, insufficient cash or working capital to replenish stock, internal theft and fraud, weak coordination between the store and warehouse, supplier delays, and more.

Sadly, some businesses assume that buying and installing software will automatically fix their stockout issues. Without a good understanding of the principles and best practices, many of these businesses with inventory management software still struggle. 

Successful companies don’t play with stock levels. They watch and manage it closely. How can you learn and apply their secrets to your business in 2026?

15/40. Theft and fraud within your business.

Internal theft and fraud are responsible for many businesses that fail every year.

It is a problem that usually goes undetected for a long time until it creates a large hole that sinks the business.

Theft usually happens when strangers, employees, or customers steal physical and tangible assets like cash, stock, tools, equipment, spare parts, diesel, office supplies, and more.

Fraud is mostly about deception. It involves the deliberate misrepresentation of financial information in your business.

It’s what happens when your cashier cleverly records a sale of N50,000 instead of N500,000, and diverts the difference.

Prolonged theft and fraud can gradually wipe out the entire working capital of a business. 

Even when the business owner raises additional capital from banks or investors to improve the situation, the effects of extra capital injection hardly save the business.

Unfortunately, many businesses never recover from serious cases of theft and fraud. That’s why prevention and early detection are better than finding a cure.

In fact, many businesses are unable to grow because their owners are afraid of potential theft and fraud if they expand the business beyond their personal control.

Sadly, this avoidance approach keeps many businesses small, stunted, and stagnant. 

To grow a business with confidence, business owners have to learn how to manage and control the risks of theft and fraud. 

Many businesses unknowingly create opportunities for theft and fraud to flourish. They have weak internal controls, over-rely on trusting employees instead of building structure and systems, and many businesses lack proper records or have disorganised finances.

So, how do successful companies with many employees and several branches discourage theft and fraud, and identify them early, even while the business keeps growing?

16/40. Neglecting business customers

Most businesses target and serve individual customers. The technical term for this is “business-to-consumer (B2C).”

However, there is a bigger and more powerful type of customer that many businesses neglect. These are business and corporate customers, and they are a very lucrative customer segment.

Businesses that partly or fully target business and corporate customers are known as "business-to-business" or "B2B" companies.

Business and corporate customers include small and mid-sized enterprises (SMEs), big companies, multinationals, NGOs, and government institutions.

These organisations have a lot of needs that range from general goods and services (like stationery, furniture, catering, cleaning, machines, toiletries, spares, diesel, etc) to specialised services such as training, consulting, financial services, technical and professional support, and more.

In fact, B2B customers usually spend more on products and services than individual customers. 

They have big budgets, buy large volumes, make repeated orders, can be more loyal and build long-term relationships, and are willing to pay better prices than individual consumers.

That’s why ignoring business and corporate customers is a strategic mistake that could be costing your business high-value and stable revenue opportunities in 2026.

Because B2B customers mostly operate on long-term contracts, they are a valuable customer base that can provide predictable cash flows and higher profit margins to your business.

However, it’s not always easy to attract and serve B2B customers, but the rewards are usually worth the effort and risk. They rely on formal procurement processes and value suppliers who are credible, structured, and professional.

How can you successfully target business and corporate customers and expand the sales, reach, and profits of your business in 2026?

17/40. Unpaid loans that trap your business

Loans can be fertiliser or poison to your business in 2026. It all depends on how and when you use it in your business.

Loans from banks, suppliers, and other sources have helped to build, grow, and expand many businesses. But you need to be strategic and manage business debt well.

Unfortunately, the inability to manage debt will create problems for many businesses in 2026, and several indebted businesses will crash under the weight of unpaid loans.

High levels of debt can cripple a business. It increases interest costs that eat into profits, and large loan repayments can deprive the business of cash that should be used to run and grow the business.

Also, unpaid creditors like banks and suppliers can increase pressure on the business or escalate to legal action to recover what they are owed.

Worse still, unpaid loans create financial distress that damages a business's credibility with suppliers, customers, banks, and investors. 

In fact, once a business is perceived as “high-risk,” banks, suppliers and investors usually restrict access to further credit.

Businesses that are trapped in unpaid loans are often victims of desperate and last-minute borrowing, inadequate startup or working capital, rising interest rates, overspending and poor cost control, internal theft and fraud, or profit and cash flow problems.

So, how can you pull your business out of unpaid and bad loan situations, or totally avoid these traps in 2026?

18/40. Indecision and bad business decisions

Up to 90% of business failures can be traced back to avoiding important decisions, or specific bad decisions and mistakes that were made by the owner of the business.

One major bad decision, or a series of poor judgements, can trigger the collapse of a business. 

Bad decisions can waste resources, trigger financial losses, destroy important business relationships, and damage the performance and reputation of a good business.

A common area of fatal decisions is with business finances. 

Many business owners ignore financial data and make poor spending decisions that negatively affect the cash flows and profitability of their business. They also take money from banks or investors that are either too costly or not suited for their business needs.

Poor strategic decisions are also a frequent cause of business failure. Many businesses continue to make terrible decisions about what to sell and how to sell it, the best prices to set, and the right customers to target.

There are also the everyday, operational decisions that relate to product quality, customer service, managing inventory, supervising employees, and keeping records. 

Bad operational decisions in these critical areas may seem small and harmless at first, but they can compound over time and lead to the untimely death of the business.

So, how can you improve your ability to make smart and better decisions that will boost the performance and growth of your business in 2026?

19/40. Mishandling difficult and toxic customers

Not all customers are good for business, especially if they are toxic customers. 

Toxic customers have behaviours, demands, or attitudes that are damaging to the health of your business, no matter the quality of service you provide.

They often demand excessive discounts, ask for features or services you never promised, or insist on immediate 24/7 attention without additional pay. 

This type of customer absorbs your attention, drains resources, and robs your business of the opportunity to serve better, high-value, and profitable customers.

They also have a terrible effect on your employees. Frontline staff who face constant abuse and unrealistic pressure from toxic customers usually suffer from burnout and low morale, and may quit your business.

Unfortunately, you can’t just ignore or fight off your toxic customers.

How you handle them matters a lot, especially in today’s hyper-connected world of the internet and social media. You don’t want to risk the negative public attention and reputational damage.

Interestingly, most toxic customers start off as difficult customers. However, many businesses don’t manage difficult customers well, and some evolve into toxic customers that harm the business.

How can you improve how your business handles customers in 2026 so you reduce the chances of encounters with toxic customers?

20/40. Selling on credit and losing money

Selling on credit to customers is an effective strategy that many businesses use to convert new customers and keep existing customers loyal.

When customers enjoy the privilege of buying now and paying later, it reduces buyer resistance, makes customers buy more, attracts more first-time customers, builds loyalty, and allows the business to set higher prices that earn better profit margins. 

It can also help your business access high-value corporate clients. 

In fact, many big and successful businesses depend on credit sales to expand their market presence and make a lot of money.

However, selling on credit is a double-edged sword that can benefit and harm your business, if the risks are not managed well.

Many businesses that are owed by customers are profitable on paper but often run out of cash and working capital. They struggle to pay suppliers and staff and have to resort to high-interest short-term loans that eat deep into profits.

Unfortunately, some customers may take too long to pay back. Also, a few customers will likely default on their debt and the business will have to bear the loss. 

Many businesses are afraid of late payments and defaults, and this fear robs them of the wonderful opportunities that can come with credit sales.

21/40. A sudden crisis that cripples your business

Many businesses suddenly close down due to a crisis that happens as a shock or surprise to the owner. 

The crisis could be the loss of your single biggest customer, the discovery of massive theft or fraud in the business, a mass resignation of your key employees, or the business suddenly running out of cash.

Interestingly, most crises that bring down businesses are not single, sudden events. They evolve over time.

They first start as threats and risks, then become problems, and then poorly-managed problems can evolve into a full-blown crisis.

Unlike big companies and multinationals, many small and mid-sized businesses don’t take risk management seriously. They don’t actively identify and assess the threats and risks to their business until they become problems and crises that hurt the business.

They overlook warning signs and "red flags" like a sudden rise in customer complaints, a slump in staff morale, increasing disappointments and delays by a major supplier, or unexplained cash flow hitches. They assume their past survival will guarantee future success.

The luck that has saved your business so far may not continue in 2026.

Successful businesses are proactive; they can see serious problems ahead of time and prepare for them in advance. They have plans and contingencies for sudden shocks and surprises.

Business can be unpredictable. So, how can you prepare your business to survive surprise attacks and crises in 2026?

22/40. Weak pricing: your prices are too low or too high

Many businesses crash, not because their products or services are not valuable. They shut down because they asked for too little or too much from the market.

One of the most deadly mistakes in business is pricing yourself too low (underpricing). 

Some businesses are tempted into this trap because a lower price tends to attract more customers and yield more sales. Others fall into this trap because they blindly copy and match their competitors’ prices.

Unfortunately, most businesses that sell at low prices don’t cover their total costs. As a result, the business gradually bleeds cash and suffers losses until it crashes.

Worse still, underpricing can devalue your product in the eyes of customers and make people question its quality or value. 

In fact, low prices often attract the wrong type of customers, known as “bargain hunters.” They are usually more sensitive to price than quality or value, and will likely jump to the next cheapest option. This prevents your business from building a loyal, high-value customer base.

On the flip side, pricing yourself too high (overpricing) can be a worse problem.

If you sell a standard and widely-available product or service that can be easily compared against competitor prices, you will face stronger resistance from potential customers if you’re overpriced.

Overpriced products struggle to sell and give your competitors an advantage. Inflated prices tend to repel customers and lead to unsold stock, rising costs, and low revenues.

So, how do successful businesses set their prices at the right spot, so they’re not too low or too high?

How can you set the right prices in your business this year that will protect your profit margins, boost sales, attract and keep customers, and give your business an edge over the competition?

23/40. Offering irrelevant products or services

Have you ever heard a business owner complaining about a best-selling product that doesn’t sell or “move” as it used to?

They often blame the economy or bad luck. But it’s neither.

Many businesses are stagnant and struggling with sales because their products or services are no longer as relevant as they used to be.

Throughout 2026, the market may change in ways that don’t favour your business.

New competitors with better products and offers may enter the market, customer needs and expectations may shift, or new product models and technologies may disrupt the market.

If you’re not paying attention, irrelevant products can make your business lose its existing customers to competitors. It’s a problem that will make you spend more on advertising and marketing to force new sales. 

And when your low sales can no longer sustain rising expenses, the business runs out of cash and crashes.

Trying to sell something the market no longer wants can blind you to opportunities to adapt, pivot, or innovate. Unfortunately, by the time some businesses in this situation realize they must change, they may have already exhausted their finances.

Customers are drawn to businesses that sell products and services that meet their needs, problems, and wants at a price that offers value for money. If your business doesn’t meet this condition in 2026, there’s fire on the mountain!

So, how can you ensure that your products, services, and offers are still relevant to your target customers in 2026?

24/40. Overwhelm and burnout of the business owner

The mental, emotional, financial, and physical strains of building a business often affect the health and well-being of business owners.

Building a business involves taking financial risks, working long hours, loneliness and isolation, and the pressure to always appear strong to family, friends, and employees. 

Over time, this tension can lead to chronic stress and exhaustion.

Several studies show that a high percentage of entrepreneurs struggle with mental health issues like stress, anxiety, insomnia, depression, and burnout.

Worse still, many business owners are unwilling to build operational structure and systems, build a team, or delegate responsibilities to employees. 

They act as the salesperson, head of operations, finance manager, and customer service agent. These daily stresses accumulate and eventually lead to overwhelm and burnout.

While overwhelm is a temporary state of anxiety and stress that happens when you feel like you’re stretched too thin by too many demands, burnout is worse. 

Burnout is the result of severe and prolonged stress that leads to total emotional, mental, and physical exhaustion. And it can take weeks and months to recover from a burnout.

As a business owner, overwhelm and burnout reduce your productivity, lead to frequent mistakes and poor decisions, and impact your ability to support your employees and serve your customers.

So, how do successful business owners who run big and complex businesses prioritise and manage their mental, emotional, and physical health in 2026?

25/40. Using the wrong legal structure for business

I once met a business owner who found an investor who was willing to put money into his business.

He agreed to a sweet deal of $25,000 in exchange for a 20% stake in his young business. Unfortunately, the investment never happened. 

Sadly, this person’s business wasn’t legally structured to accommodate equity shareholders or investors. His business had the wrong legal structure for the kind of company he wanted to build.

Legal issues are the most overlooked and ignored problems in business until they come around to bite you.

They are silent killers that can come out of nowhere to destabilise or crash your business.

One of the most common legal problems businesses face relates to the structure of the business.

Many entrepreneurs make the strategic error of starting or operating a business without a legal structure, or with a structure that least suits their kind of business.

Choosing the legal structure for a business is one of the earliest decisions many business owners get wrong. Unfortunately, this faulty foundation can haunt your business for a long time.

The wrong legal structure can severely limit the potential of both new and existing businesses. 

It can limit your access to opportunities, funding and capital, increase your tax burden and make you pay more than you should, expose you (the business owner) to catastrophic personal risks, and make it difficult to sell or exit a business.

So, is it best to operate your kind of business as an informal and unregistered company, a sole proprietorship, a partnership, a limited liability company, a joint venture, SPV, holding company, or what exactly?

26/40. Over-reliance on a single product, revenue stream, customer, or supplier

It’s very risky to gamble the growth and success of your business on a single product, revenue stream, customer, or supplier, no matter how lucrative and promising they are.

This risk, known as concentration risk, creates a single point of failure that has crashed many businesses.

If the market shifts or the competition tightens, the loss of that single product, revenue stream, supplier, or important customer could trigger the immediate and irreversible collapse of your business.

When a single product, customer, or revenue stream is responsible for more than 40% of the income of a business, the owner should be worried.

The sudden loss of a flagship product, revenue stream, or customer can evaporate the income of a business overnight. With fixed expenses and financial obligations like rent, salaries, and loan repayments, many businesses in this situation are forced to shut down.

On the supply side, depending on one vendor for critical raw materials, inventory, and supplies can expose your business to sudden disruptions. 

If your sole supplier is unable to deliver, you may have to delay or stop production, disappoint loyal customers, or incur higher costs on emergency purchases from alternative sources.

Most successful companies don’t put all their eggs in one basket. They diversify their income across different products, services, customers, and revenue streams. They also have alternatives, just in case a major supplier defaults.

How can you reduce your dependence on a single product, revenue stream, customer, or supplier in 2026?

27/40. Simple but costly branding errors

Your business brand is more than just a logo and bright colours.

Your brand is what people think and feel about your business or products. And you have to start curating your brand even before you launch a new business or a new product.

Unfortunately, many businesses struggle to attract and keep customers because they make simple but avoidable branding errors.

The most common error is choosing the wrong name for your business, products, or services. 

Brand names that are hard to spell, difficult to pronounce or recall, have negative cultural tones, or are too generic, usually fail to build memory and authority.

Another common error is limiting the future potential of a business or product by choosing names or identities that are too specific to a single product or location.

This can box a business in and make future growth and expansion impossible without an expensive rebrand.

Branding errors, like a confusing business or product name, can be costly and drain profits. They usually lead to higher advertising spending just to achieve basic awareness for your business or products.

In some cases, poorly researched brand names can lead to expensive trademark or copyright infringement lawsuits that can bankrupt a small business.

How do you ensure that your business is not crippled by simple but costly branding errors in 2026?

28/40. Choosing a bad business location

If your business meets or serves customers in person, choosing the right location for an office, shop, or store can be a "make-or-break" decision for the business.

Even if you have the best products or services, a bad location ensures that customers will not notice your business. And if you are not visible enough, your business will struggle with foot traffic, sales, and customer retention.

Unfortunately, location mistakes can be expensive and have long-term effects on a business. 

Once the choice is made, a bad location is difficult to reverse or change, and forces the business to stay in a losing position until it runs out of cash.

To be clear, bad locations are not always about cheap rent. In fact, many businesses crash because they overspend on high rent for “prime” locations that eat up their profit margins.

Most businesses in a bad location didn’t consider accessibility, convenience, affordability, foot traffic patterns, nearness to target customers, and dominance of strong competitors in the area, among other key factors.

How can you choose the right location for your business in 2026 without making a fatal, long-term mistake?

29/40. Entering important business relationships without agreements or contracts

Healthy relationships with key suppliers, employees, customers, partners, landlords, investors, and creditors play a major role in the long-term survival of any business.

Unfortunately, one of the leading (but hidden) causes of failed businesses is going into critical business relationships without a formal contract or agreement.

Some people fall into this trap because they want to save time and quickly exploit business opportunities.

However, most business owners actually ignore professional agreements because they prioritise informality, trust, friendship, family bonds, verbal promises, and handshakes.

As a result, many business relationships end in financial losses, disputes, and regrets because of unclear responsibilities, unclarified assumptions, misaligned expectations, and unenforceable rights.

Many entrepreneurs often feel bitter, disappointed, cheated, and deeply embarrassed when important business relationships fall apart. But a simple, valid, and enforceable agreement could have avoided such situations.

How can you ensure that your most important business relationships in 2026 are structured in a way that reduces confusion and conflict, and protects your interests?

30/40. Poor planning: always reacting to business problems

When a business owner doesn't plan and think ahead, they typically spend 100% of their time reacting to emergencies and solving today’s problems.

Poor planning is dangerous, expensive, and makes a business vulnerable. It’s no surprise it ranks as one of the top reasons for business failure.

Unlike proactive businesses that can anticipate and quickly resolve business challenges, reactive businesses are usually taken by surprise and tend to spend more time, effort, and resources to solve the same problems.

While proactive businesses budget their spending, plan their cash flows, and secure access to low-cost capital early, reactive businesses often realise they are out of cash at the last minute, forcing them into high-interest emergency loans that wipe out their profits.

Businesses that don’t plan are usually weaker and less agile than their competitors.

They lack structure and often rely solely on the business owner for direction. As a result, every small challenge becomes a crisis that requires management's intervention.

So, how can you make your business more proactive and better prepared for the challenges and opportunities in 2026?

31/40. Compliance issues with taxes, licenses, registrations, etc.

The local, state, and federal government authorities in your country are powerful stakeholders in every business, especially with the introduction of new and robust tax laws in Nigeria and other African countries.

The authorities can shut down businesses, impose fines and penalties, take legal action, and disrupt your business in several different ways.

Therefore, operating a business without formal registration, valid licenses or permits, regular filings and renewals, or non-compliance with industry rules and tax regulations can lead to heavy financial costs and consequences. 

In fact, the cost of compliance is usually significantly less than the costs and pains of non-compliance.

Fines and penalties can be hefty, depending on the severity of the violation. They can range from thousands to millions of Naira (or your local currency).

Shutting down your business could cause you to lose sales and customers to competitors, and damage the brand and reputation of your business.

Court cases and unpaid tax bills could result in huge legal costs and settlements.

And a track record of non-compliance by your business could attract ongoing scrutiny by the authorities, frequent audits, and drain your attention away from running and growing the business.

So, how can you ensure that your business doesn’t incur any avoidable costs of non-compliance in 2026?

32/40. Weak distribution and low market penetration

More people want to buy your products, but they can’t find them. It’s not on supermarket shelves, in open markets, online, or in the regular places your target customers typically shop.

In many cases, businesses with very good products still struggle financially because of poor distribution. Even a fantastic product will not sell if customers cannot find or access it.

Weak distribution and low market penetration are serious problems that can trap a business in a cycle of low sales, insufficient revenues, and rising losses. 

Eventually, most businesses in this situation run out of cash and close down. They crash, not because they didn’t have the potential to succeed, but because they couldn’t “push” and distribute their products to penetrate the market.

Unfortunately, an average product with strong distribution will always perform better than a fantastic product with weak distribution.

The truth is that distribution, and not the product, holds the key to successfully penetrating any market, attracting and keeping more customers, boosting sales, beating your competitors, and making good profits.

Coca-Cola is not the most successful soda drink in the world because it is the best product. Several great drinks have tried to compete against Coca-Cola and failed because they couldn’t beat Coke’s strong and massive distribution network.

So, how can you improve the distribution and market penetration of your products and services in 2026?

33/40. Playing superhero: not empowering employees with responsibilities

Many businesses are built around the availability and involvement of the owner. The owner (superhero) must make all decisions, approve every invoice, negotiate every deal, and review every email.

Unfortunately, when the performance of a business is heavily dependent on its owner, this creates a fragile, "hero-dependent" culture where employees become passive, disconnected and lacking initiative.

When the superhero becomes ill, takes a vacation, or burns out, the entire business slows down or grinds to a halt. This limits the ability of the business to grow, quickly respond to challenges and opportunities, and survive serious crises.

Many (small) business owners don’t empower employees with responsibilities for various reasons.

Some owners are trapped by perfectionism or the fear of losing relevance, and insist on doing even low-level tasks themselves rather than delegating, training, or building structures and systems that empower employees to do good work.

Interestingly, some owners often hire employees based on trust, friendship, or family ties rather than competence, and then feel they must do the work because they don’t trust the skills of the people they hired.

How can you avoid the trap of playing superhero and start building a business in 2026 that runs on delegation, accountability, structure, systems, and empowered employees?

34/40. Not developing strategic partnerships

There are some business problems and challenges you will struggle to overcome by yourself. You may not have the experience, knowledge or skills to resolve them.

There are sales and growth opportunities your business will struggle to unlock alone. It may lack the capacity, capital, relationships, or resources to exploit them.

Without the help of strategic partners, many businesses stay stuck and stagnant, and continue to perform below their true potential.

Strategic partnerships provide leverage and act as force multipliers. Without them, the growth and success of a business is strictly tied to its own internal capacity. 

As a result, some businesses spend years trying to achieve results that strategic partnerships could have done faster.

For instance, strategic partnerships can help with marketing and distribution. They can give your business quick access to new markets, lucrative customer segments, and local distribution networks that would have taken years to build.

The right strategic partners can provide valuable technical expertise that boosts the credibility of your business, and improves the quality of your products, services, and internal processes.

Strategic partners can also provide patient capital (loans, equity or grants) that can help to grow and expand a business. They can act as trusted financial and business advisors who can guide the key decisions and growth aspirations of your company.

In 2026, how can you develop and structure win-win strategic partnerships that will transform the performance and growth of your business?

35/40. Promos, giveaways, and discounts that attract the wrong customers

Some marketing and sales tactics can backfire and land your business in deep financial trouble if you don’t apply them properly.

Poorly-planned discounts, for example, can significantly eat into the profit margins of a business.

Take a product with a 30% profit margin, for instance. Offering a 20% discount will require a 200% increase in sales just to maintain the previous profit level.

Also, customers who habitually chase discounts (known as “bargain hunters”) tend to have zero brand loyalty and will quickly pivot away from your business when the next competitor offers a lower price.

In many cases, when a business spends more to acquire a customer via promos, giveaways, or discounts, the customer may not yield enough sales to justify the acquisition costs.

As a result, some promos and giveaways lead to profitless growth. Your business may experience a spike in sales volumes, but after accounting for discounts, marketing and fulfilment costs, it may not have sufficient cash to cover overheads like rent or salaries.

Sadly, most giveaways that offer high-value, generic prizes (e.g., cash or iPhones) are likely to attract people who have no real interest in your brand or product. In the same vein, people who receive low-quality giveaways (e.g., branded items) often discard them within months.

Worse still, when a business offers reckless giveaways and discounts, it can create an impression of declining value in the minds of customers. This often makes it difficult for your business to transition back to premium pricing.

So, how do successful businesses plan and structure their promos, giveaways and discounts to attract good-quality customers and boost profits?

36/40. Continuing with loss-making products, projects, and businesses

There are two types of loss-making products and projects that can crash a business in 2026.

The first type is an unprofitable product or project that brings in a lot of sales. However, when you really look at the numbers and consider your costs, you will notice you’re actually making losses on those sales.

The second type is a product or project that I call a “sink.” You continue to spend money, time, and effort on it, but the losses continue.

Failing to cut loss-making products, projects, or business units is a serious strategic error and one of the leading causes of business failure.

Unfortunately, many business owners don’t really know which products or projects are actually unprofitable. 

Due to poor financial records and a lack of costing and pricing models in many businesses, loss-making products and businesses often fly under the radar, go unnoticed for a long time, and continue to waste resources.

Also, emotional attachment and indecision can contribute to this problem.

Even when they know that a product or business is loss-making, some business owners are afraid of losing the significant time, money, or emotional energy they have already invested.

They avoid making the tough decision and continue to throw good money after bad.

Sadly, some entrepreneurs don’t act quickly enough to stop the bleeding caused by loss-making products or businesses. This mistake ultimately depletes the capital of the business and makes recovery almost impossible.

So, how can you identify this problem early in your business and make the smart decision in 2026 to limit the effects of loss-making products and business units?

37/40. Fights between business co-owners and partners

It is heartbreaking when a business fails, not because it’s not viable, but because the co-owners, partners, or investors behind the business are fighting over finances, ownership, control, strategy, or petty ego-driven issues.

While clashes between co-owners and partners are quite common among new and young businesses, they also happen within older and mature companies.

When business co-owners or partners cannot agree, the business stagnates. Important decisions are delayed or ignored, and the business misses critical opportunities for sales, profit, and growth.

Fights between business partners often escalate into court cases, frozen bank accounts, and messy buyouts. These distract and derail the focus of the business, and drain its working capital until the business runs out of money.

Disputes can also impact staff morale and productivity. Good employees often quit to avoid a “toxic” workplace, while others may choose sides and worsen the situation. These internal divisions ultimately paralyse the operations and performance of the business.

More importantly, public or bitter fights between business partners can damage trust with customers, investors, and suppliers, and quickly destroy the credibility of the business.

Despite these challenges, businesses that are co-owned by two or more people tend to grow faster, enjoy stronger leadership, and are more favoured by investors and banks.

While global examples like Google, P&G, Microsoft, Intel, and Apple abound, successful Nigerian companies like GTBank, Access Bank, Sahara Group, Paystack, PiggyVest, and Flutterwave prove that strong and compatible co-owners and partners can create magic together.

The most common causes of fights between business partners include poor partner selection, misaligned visions for the business, unequal workload and commitments, unfair ownership and profit sharing, communication breakdowns, power struggles over roles, and clashes of egos and personalities.

So, how can you prevent the likelihood and impact of bitter disagreements, disputes, and fights between co-owners and partners in your business in 2026?

38/40. Inability to raise enough capital to start or grow your business

Some businesses cannot be started or grown with the personal funds of the founder alone. The business may need outside financial help from lenders, investors, banks, or partners.

But raising capital from external sources is not always easy. The difficulty level largely depends on your type of business, how much capital you want to raise, and who you want to get the money from.

Unfortunately, a significant number of people who want to raise capital for new or existing businesses can’t find the funding they need. They struggle to attract or convince the right investors, banks, or financial partners.

Without the right amount of capital, some viable and promising business ideas cannot become real businesses. They can’t cover the initial startup costs and day-to-day expenses required to keep a new business alive.

Also, many business owners are unable to grow their businesses. Without a fresh injection of capital, they cannot expand their current space, order larger volumes from suppliers, open new branches, acquire more machines and equipment, or hire more employees.

In summary, the inability to raise enough capital is a major killer of business dreams. It robs both aspiring and current business owners of the financial resources they need to execute their ideas and strategies.

In my experience, most people who struggle with raising capital don’t really understand how fundraising works, or the right type of capital to target for their business, or how to position their business for equity investment from investors, or loans from banks and private lenders.

So, how do smart entrepreneurs and business owners successfully raise the capital they need to start or grow their business in 2026?

39/40. Carrying the burden of transferable risks

Business is full of risks. As a business owner, you take risks every day; whether you realise it or not. 

Every time you sell a product, serve customers, buy goods from suppliers, or employ staff, you’re taking risks.

So, how does your business recover if your shop or warehouse burns down, or your goods get lost or damaged in transit, or a customer takes legal action against your business, or a key employee suddenly quits or dies?

Unfortunately, the response I often get from most business owners to the above question is: “God forbid!”

The truth is, most big and successful companies don’t take risks they can avoid or transfer to a third party. They proactively manage risks, instead of reacting to them like most small and growing businesses do.

Why wait until one of your customers takes legal action against your business when you can proactively protect your business with contract clauses that limit your liability to customers?

Why wait to suffer the catastrophic loss of your factory, or the goods and assets in your shop (or warehouse), when you can transfer the risk to an insurance policy that covers fire, burglary, theft, and special perils?

Why wait until your new machine or equipment breaks down when you can transfer the risk to the vendor, manufacturer, or technical partner through warranties, guarantees, or SLAs?

If your business receives or delivers goods over long distances, why wait until they are damaged or stolen in transit when you can transfer the risk to a goods-in-transit insurance policy?

Many businesses still carry the burden of risks they should transfer because they underestimate the financial and operational impacts on their business. Many people also don’t realise they can actually transfer business risks to third parties.

So, how can you protect your business from risks that can be transferred to third parties in 2026?

40/40. Cyber attacks: hackers and ransomware threats

In 2025, there were roughly 4,300 cyberattacks per week on Nigerian businesses, according to Check Point. That’s a 30% jump from the previous year.

This is not just a Nigerian or African problem. The trend is on the rise across the world.

It used to be only big and popular companies that were targeted by cybercriminals. Nigerian banks, for example, lost more than ₦53 billion to direct cyberattacks in 2024 alone, and the figures keep getting worse every year.

This year, the volume and targets of cyberattacks are expected to rise significantly, and more small and lesser-known businesses are likely to be targeted across different industries.

In late 2025, for example, Leadway Assurance, one of Nigeria’s insurance companies, was the victim of a cyberattack. 

The hackers hijacked 13 GB of the company’s data that likely contains sensitive customer and financial information, and asked for a $300,000 ransom.

Hackers and cybercriminals now see smaller businesses as "high-value, low-security" targets because they hold sensitive data but lack the robust IT defences of big companies.

Unfortunately, many small businesses don’t survive a major cyber attack. Apart from the heavy financial costs of ransom payments and fixing compromised IT systems, the impact of disrupted operations can lead to a loss of customers and serious reputational damage.

How can you protect your business from the risk of cyber attacks, hackers, and ransomware intrusions in 2026?