Well obviously there is no one particular reason for a company to go under. This is a boutique hobby, and many manufacturers are started by one man operations on limited budgets. So many things must go right for a company to grow and prosper with such a finicky group of consumers.
That said, I think that many times the "problem" is that a manufacturer just does not do a good enough job on an accounting cost basis analysis level. For example, my speakers are Soliloquy 6.3i's, from the now defunct Soliloquy company. A 2.5 way design in which each cabinet weighs in at 100 pounds, beautiful machined, adjustable floor spikes and brand name components and wiring. When new they listed for $3195. After listening to them, I would say that Soliloquy went out of business because they underpriced their product. These speakers could have easily sold for $5K, if not $10K with some better marketing. When a small manufacturer tries to offer outstanding value while trying to survive on razor thin margins, it generally does not turn out well. This would be a case of underestimating costs and/or not spending enough on marketing. You have to properly "grease the wheels" to succeed and thrive in any business, not just audio.
So you could say that many companies go out of business because they offer too much value to the consumer and they are not paying enough attention to their "true" costs. Of course this is not always the case, in many cases in the one man operation the one man becomes ill, and cannot keep up with the business. Obviously there could be a myriad of other reasons to, luck is involved in any business venture.
That said, I think that many times the "problem" is that a manufacturer just does not do a good enough job on an accounting cost basis analysis level. For example, my speakers are Soliloquy 6.3i's, from the now defunct Soliloquy company. A 2.5 way design in which each cabinet weighs in at 100 pounds, beautiful machined, adjustable floor spikes and brand name components and wiring. When new they listed for $3195. After listening to them, I would say that Soliloquy went out of business because they underpriced their product. These speakers could have easily sold for $5K, if not $10K with some better marketing. When a small manufacturer tries to offer outstanding value while trying to survive on razor thin margins, it generally does not turn out well. This would be a case of underestimating costs and/or not spending enough on marketing. You have to properly "grease the wheels" to succeed and thrive in any business, not just audio.
So you could say that many companies go out of business because they offer too much value to the consumer and they are not paying enough attention to their "true" costs. Of course this is not always the case, in many cases in the one man operation the one man becomes ill, and cannot keep up with the business. Obviously there could be a myriad of other reasons to, luck is involved in any business venture.