Author Topic: 12 Ways to Overcome Small Business Failure and Thrive in Hard Times  (Read 1516 times)

Maliha Islam

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12 Ways to Overcome Small Business Failure and Thrive in Hard Times

A fundamental part of overcoming business failure is rooted in the mindset you have. It begins with a flexible and positive attitude and a willingness to change. Winston Churchill stressed this vital factor by saying, “To improve is to change; to be perfect is to change often.” Failure, including when running a business, is part of life. How we deal with it determines whether or not it ultimately leads to success.

We can learn a lot from successful business owners of the past, such as Colonel David Sanders, the founder of KFC (Kentucky Fried Chicken). At 65, this financially unstable retiree, with only a $105 to his name, roamed across America, trying to find an investor for his fried chicken business. He faced rejection. However, armed with the positive mindset for change, he pushed ahead with his plans. Finally, someone saw his worth, invested in him, and KFC was born. He sold the company for 2 million when he was 74. The ROI on the measly $105 he started out with was staggering.

The takeaway from Colonel Sanders is, a mindset eager to embrace change coupled with dedication, hard work and determination are some of the qualities you need for business success. This will help you overcome business failures when you’re up against a financial downturn, break-up, divorce, or any other personal or professional misfortune.

Follow these rules to keep your business on a firm foundation, ready to weather predicted or unexpected storms, aiming to damage your enterprise.

Adopt a Forward-Thinking Attitude

Before you plan out your business, start with a vision. Write the vision down. Use it as a map to create your business plan because it will give you clarity.

Think ahead. What outcomes do you want for your business? Where would you like the company to be in the coming months and years?

To help you decide, your vision could include:

Your mission statement
The products or services you will offer
Your business niche
Ways to find prospects
Marketing strategies
Problems you will solve and
Ways to position yourself against your competitors
This list is not set in stone, however.

Your vision could be as large or as small as you want it to be. The important thing is making it workable and achievable.

Carry out Frequent SWOT Analyses of Your Business System

A SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis is an examination of the internal and external areas of your business.

The aim of this exercise is to identify areas that are working and those that are not. For example:

Strengths are good internal factors within the business. Things are working in this area. Therefore, develop this part of your business. Use it as a model to build on.

Weaknesses are damaging internal factors. Something is not working properly. Perhaps it’s your sales and marketing strategy. Look at how to make immediate changes, do something different, or stop what you’re doing.

Opportunities come from external factors and represent good prospects for the future. Capitalize on these ventures, and optimize them.

Threats are adverse external factors such as your competitors. Set goals to make improvements in the areas of your business affected by this problem.

To prepare a SWOT analysis, begin by making a list of your identifiable strengths and weaknesses. Ask yourself where you would like your business to be in the future. Look at where you are now. Use the results of your SWOT analysis to design the goals you intend to accomplish and to develop a plan of action.

Manage Cash Flow Efficiently

Without consistent cash flow, your business will eventually dry up and die. You need to have money coming in, or you won’t be able to pay expenses. First, have a cash flow forecast so you know what money is coming in and out.

Remember, this is only a forecast, but it will give you an insight into your financial future.

Use the forecast to project likely sales and expenditures (including cash transactions) so you know how much you’re likely to have in your bank account.

There are ways you can manage your cash flow efficiently, such as sending out invoices on time, taking deposit payments in advance, paying bills on time and promptly following up with late-paying customers.

Believe in Yourself, and Prepare for the (Inevitable) Bad Times
When you’re up against unexpected personal trials that breed stress, your mind becomes muddled. Plus, your self-esteem could take a tumble, having an undesirable effect on how you see yourself.

"Doubting your abilities will impact your business unfavorably. For that reason, make use of personal problems. See them as lessons to learn from," says David Christensen, a legal advisor who has counseled several individuals facing debt-related challenges.

Safeguard yourself by developing resilience. Understand that life comes with problems. Assess the situation objectively. Speak with a trusted friend or family member instead of ignoring the problem. Don’t be hard on yourself, and keep believing you can overcome the obstacles you are facing. Surround yourself with the right support network of people. Don’t give up.

Perseverance, Determination, and a Positive Mindset Rein Supreme
Running a business and making it successful is not easy. If anyone tells you otherwise, they’re lying. However, it’s not impossible for you to survive in the business world. On the contrary. Embrace the warrior mindset, and refuse to become a number in the statistics of business failures. According to Small Business Trends, 50 percent of businesses fail within the first four years.

Work Through Loss by Reaching out to Family Members, Friends, and Professionals
The experience of losing a loved one is inevitably accompanied by various emotions, including sadness, helplessness, anxiety, and anger. These feelings are a natural part of the mourning process.

Involving others in your grieving can make it more bearable. Talk about it. Tell your close friend or family member how you feel. If you don’t have access to them or if you feel you need more support, consult with a health professional or a grief counselor.

Don’t bury your emotions and lose yourself in your business. Ask your business partner to take over for a while, or close your business for a few days. It’s important to work through the grief instead of trying to run the business as usual when your mind is somewhere else.

Keep Your Customers at the Heart of Your Business
Eighty percent of a company’s revenue comes from 20 percent of its customers, according to Gartner statistics. Loyal customers are the success stories of your business. Involve them in your business strategies when planning marketing campaigns and developing new products. Share their case studies, consider their points of view and feedback (good or bad), and make them feel important.

Starbucks, the number one coffee shop chain in the world, takes their customer experience seriously. When hiring, some of the qualities they look for in potential staff are having a good attitude, interest in the customer and enthusiasm to meet their needs. And they are not afraid to invest time and money into creating the best customer service experience they can deliver.

Plan Ahead by Considering the Financial Impact of a Divorce on Your Business
Going through a divorce can not only break you emotionally but also destroy your business financially. Funding the divorce could wipe out a substantial part of the hard work you put into developing your business.

How do you cushion yourself against the nightmare of a divorce and its possible impact on your business?

One way to plan ahead is to have a prenuptial agreement before getting married. Plus, it might help to consider how much involvement your new spouse should have in your business.