Solutions to Small Business Failure
Failure in business is very common. It is true even for those businesses that are led by experienced serial entrepreneurs. No doubt, failure is inevitable in the world of entrepreneurship. However, the most successful entrepreneurs are not limited or defined by their failures; they are defined by how they deal with it. Being able to navigate through business failure is no cakewalk, but not impossible either. All it takes is your willingness to learn and stay focused on your goal.
Mostly, business failure is caused by a combination of a lack of funds to keep the overhead operations going and the inability to emotionally connect with the customer. This is especially true for first-time entrepreneurs. What do you do to avoid falling into the spiral of failing business depression? What are the options that you will have to think about? Could a marketing strategy consultant help your business? Likely. But before you approach a marketing strategy consultant, what is it that you need to do after a business failure? Let’s dive in.
1.Focus on Your Finances
What to do when your business is in trouble? Focus on your finances and get them in order. Needless to say, this should be on the top of your list. Make sure you get your finances—personal as well as professional—in order. This goes without saying, as you will no longer be able to depend on your business as the key source of income. Note that if you had put in your own personal savings in the business, then you may stand to lose more in your business’s failure. This is the time to muster up your courage and energy to analyze and gather your finances. Fret not, there can still be a bright financial future ahead of you — provided you spend some time figuring out a new line of income.
It is easy to fall into the dangerous spiral of failing business depression. Muster your will and analyze the failure. Make a list. Why did your business fail? What factors contributed to the hiccups and ultimately, failure in your business? What are the solutions to your small business failure? Analyze to see if there are common threads in your list. Reduce the most common cause of failure and see what you can do about it. The likelihood of the root cause being a very common and identifiable cause is very high. Spend some time looking over your business’s history and see if you can recognize any identifiable pattern which led to the business going under. See what kind of decisions were made. Were those decisions wise? Or was it the reason for the downfall of your business? The better you understand why your business went under, the more likely you’ll be able to prevent a repeat outcome in the future.
3. Take a Time-Out
If your business is going under, then it is natural that you may want to dive deep and try to get everything in order as soon as possible. Granted the focus is your business, but it doesn’t mean that you should forget about yourself. Entrepreneurship itself is demanding, and losing business is more so—it is tough. But look at it as a critical opportunity to gather yourself and spend some time doing what you have always wanted to do. Spend some time relaxing and put some distance between you and your business. Take a vacation if the situation allows you or spend time on hobbies and personal projects. The important thing is to de-stress and clear your mind of clutter. This will allow you to come up with fresher ideas and implement new strategies that may save a sinking ship. De-stressing will help prepare yourself to take on whatever life throws at you and overcoming it with grace.
4. Work With Like-Minded Entrepreneurs
If you haven’t joined a networking platform, now is the best time to do so. Networking is crucial for business, but even more so when your business is not doing so well. When you expose yourself to more entrepreneurs and share your experiences, you will gain new perspectives. Ask about their strategies and gather knowledge. You will also make new contacts along the way. You can choose to go to networking events, connect with entrepreneurs through social media, or even just introduce yourself to business owners during the course of your day. This way, you will gain a fresh perspective on your business and also learn new ways to deal with the problems you faced. You will find that there is amazing support in the entrepreneurship community.
5. Start Thinking about a New Business Plan
Even if your business fails, it is no reason to give up being an entrepreneur. Take some time off, get your finances in order, analyze what went wrong, then sit down with your best thinking hat and come up with a new business plan. If you think you are cut to be an entrepreneur, then a single, nor even multiple business failures will not bring you down. Keep a notepad handy at all times—you never know when an idea may strike. Make a habit of jotting down your thoughts. Yes, it is hard work, but pays off in the long run. You will be able to literally see your thoughts and find common threads of ideas and sketch out the promising ones with model business plans.
Next What? Life After Business Failure
A failed business gives you lots of experience and you will be able to use this newfound experience to move things along when the going gets tough. Remember to leverage the power of your experiences as an entrepreneur when you move on to bigger and better opportunities in life.
Absolutely do not distance yourself from the people you worked with as an entrepreneur. Contacts are always valuable. The bigger your network is, the better. Your contacts will be able to refer clients, work for you, or even become partners. Your contacts will become a source of your income.
Don’t be shy of failure. Talk about your experience as an entrepreneur. You never know, you might even become a motivational speaker!
Always remember, even if you start off with a fantastic idea and an excellent source of funding, have a stellar team and be prepared for contingencies, there is still a possibility that your business can collapse due to factors that are beyond your control. Failure is a real possibility for the vast majority of business owners out there. Being an owner of a failed business isn’t an indication of personal failure; instead, look at the larger picture. Going forward with the knowledge gained will make you more likely to find success in your next venture.
What according to you is important to make your business a success?