Why Most Ecommerce Startup Fails

Why Most Ecommerce Startup Fails

Sat, 10 Apr 2021

Unlike the past 10 years, one of the dream careers for college graduates is now operating a startup. In the current generation of college graduates who own a startup, they will be ranked high along with rock stars or film stars. While the odds of winning bread in start-up firms can be higher than being a top-ranking actress or a rock star, the performance rate is still small. This varies slightly from country to country in terms of both the quality of the failure and the magnitude of the failure.

Reasons Why Most Online Businesses Fail

Unfortunately, however, the fact is that, like most small companies, most start-ups have failed. According to research, 75% of the venture-backed start-ups have struggled. A new report, “Entrepreneurial India,” by the IBM Center for Business Value and Oxford Economics, showed that 90% of Indian start-ups had struggled in the first five years. The lack of innovation is believed to be the key determinant of the success or failure of India’s start-up. 77 percent of the venture capitalists surveyed claim that many Indian start-ups ignore innovative creativity focused on an emerging technology or specific business models.

E-Commerce Start-Up Has Four Stages


  1. Know your customer
  2. Building the wrong product.
  3. Business Model failure
  4. No market need

Product development stage

  1. User Interface (UI) / User Experience (UX) Issues
  2. Mistakes Businesses make while executing their Online Marketing Plan

Execution stage

  1. Poor management team
  2. Running out of Cash
  3. No cash flow
  4. Poor Inventory Management
  5. Too Much Competition
  6. Product Problems
  7. Market Problems

Marketing, Controlling, and Exit stage.

  1. Poor Marketing
  2. Disharmony among team and investors
  3. Ignore customers