What Should You Do If Your Business Has Failed?
Nobody wants to be in a position where they have to answer this question but it does happen sometimes. Even if you’re doing everything right, sometimes the markets just aren’t right and your product doesn’t take off. The worst thing that you can do is live in denial and go down with a sinking ship because it’ll just put you in a worse financial position afterward. It’s best to cut your losses and get out early so you can start working on your next business venture. If your business is failing and it doesn’t look like there’s any hope, these are the steps that you need to take.
Make Sure That It’s Really Over
It’s easy to panic when your business is in trouble and convince yourself that it’s over, but that’s not always the case. You might be able to cut back on spending and turn things around. It’s important that you try everything you can before you make that tough decision and decide to close the business for good. There are a lot of tell-tale signs that it’s the right time to close your business. If you’re using your personal credit cards to cover business expenses, that’s always a bad sign. Working ridiculous hours to try to keep things afloat because your best employees are leaving is a big red flag as well. If you start to notice these things, it’s probably time to call it quits.
Assess Your Own Finances
If you’ve put a lot of your own money into this business, you might be in a pretty bad financial situation. Now is the time to assess your finances and do some damage control. Work out exactly how much you stand to lose and what you’re going to be left with afterward. If you have a lot of big debts that you can’t afford to pay, you should consider speaking with a bankruptcy attorney to see whether that might be the right solution for you. It’s important that you make sure that you’re going to have enough money to live on once the business has been shut down.
Shut It Down Slowly
Closing a business down isn’t as simple as just locking up the office and handing back the keys, there are so many things that you need to sort out. Any debts need to be cleared, you need to pay back any investors that you borrowed money from, liquidate all of your assets, and let staff know that they need to start looking for a new job. A lot of other people have a stake in this business so you can’t just pull the rug from under their feet and tell them that they’re out of a job or that you’ve lost their investment.
Move On
This is so important and a lot of people struggle with it. When one business has failed, it’s easy to give up on your dreams of running a successful company but one wrong move doesn’t mean that you’re done for good. All of the most successful business owners in the world have had multiple failures. It’s their ability to pick themselves up and start coming up with a new business idea that sets them apart from the rest.
It might feel like the worst thing in the world right now but if you deal with your business failure in the right way, it’ll eventually become a small footnote in the story of your success.