ABSTRACT

In terms of planning, managers are encouraged to study the social, technological, economic and political environments before identifying a firm's strengths, weaknesses, opportunities and threats. The single most important factor which distinguished failed from turned round companies in his sample was an inability to combat price competition. But almost as significant was having a relatively high cost structure, usually because the company was too small to benefit from economies of scale. The most highly scored reasons for business failure by the respondents were poor financial information, lack of control, insufficient working capital, inexperienced management, lack of strategy, poor understanding of the market, low margins, over reliance on one product or customer, and obsolete technology. The purpose is to identify the linkage between the causes of decline and the remedial steps taken; and the continuing characteristics of firms and those remedial steps.