What is the percentage of all businesses that went bankrupt?
Percentage of businesses that went bankrupt
The percentage of businesses that went bankrupt was about 50% in Britain, 25% in the United States, and as low as 10% in Japan.
Small businesses
Less than a year
Small businesses that have been in business for less than a year have a 1.5% chance of going bankrupt. Number of small businesses that went bankrupt: 400,000
Less than three years
Small businesses that have existed for less than three years have a 3.7% chance of going bankrupt. Number of small businesses that went bankrupt: 121,000
Between one and three years
Small businesses that have been in business for between one and three years have a 4.4% chance of going bankrupt. Number of small businesses that went bankrupt: 235,000
Between three and five years
Small businesses that have been in business for between three and five years have a 5.4% chance of going
bankrupt. Number of small businesses that went bankrupt: 181,000
More than five years
Small businesses that have been in business for more than five years have an 8% chance of going bankrupt. Number of small businesses that went bankrupt: 354,000
In summary, the chances of any one business going bankrupt are 0.6%.
Compared to the rest of the population, small business owners are especially likely to file for bankruptcy. If you're considering starting a business, you should be aware that this significant risk is part of the deal, but there are steps you can take to minimize it.
In the United States alone, small businesses are closing up at an alarming rate. One study reports that about half of all businesses fail within the first five years. According to a recent census study, about 75 percent go under within fifteen years.
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