It can be crushing to see your own company floundering in front of your eyes. A business does not fail overnight. As the entrepreneur of a failing company, you might have seen this disaster coming. These signs can be summarized as a halt in growth, poor cash-flow management and lack of innovation. Although, you might have heard from many well-wishers that every business has its ups and downs and that you might be going through a tough phase, but deep down, you know that things are not looking promising anymore. Frustration, anger, despair and sadness are some of the emotions which greet you more often during such a phase. But it is during these rough circumstances only, that you have to set aside these emotions and think with a clear mind. Not only that, you also need to think fast.
A classic example of how a failing business was revived and put to the top 5 businesses in the world is Apple’s story when Steve Jobs returned in 1997 with some tough decisions to reduce product line from 350 to just 10. The rest is history but at that crucial time, it was impossible to believe in him.
It often happens that a failing company that could be saved, goes down the drains because of loss of hope. To save your business from failing is largely in your hand. To jump-start a new business, you need to breathe new life into it. Mentioned below are some fail-proof tips to save business, which will give your business the jolt of energy it requires.
“Situation Analysis”
The moment when it syncs in completely that your business is in serious trouble, you need to stop and take a hard look to evaluate and assess the situation. Keep in mind that businesses do not fail overnight. You might get certain indications much before and if you overlook those signs, they might just add up to give you a big blow one fine day. From day one you have to be very detailed about internal audit of employee, customer satisfaction, tracking and financial health and other such factors to avoid issues later on. When you do realize that something is not right with the way your company is functioning, you can start with cost cutting, re-planning company’s strategy, re-branding or innovating new products. Also check the sales and finance graphs of your company to analyze the situation better.
A business may fail due to a number of reasons. Your competitor or multiple rivals have entered the market and stolen your share of customers. It could also be because you have not been innovative and creative with your products and approach. Peak into the graph of the time when your profits and sales were very strong. Next, analyze what went wrong later. Did your graph go down because of a new competitor, a new product in the market or have you failed to update your product as your competitors have done? Once you determine the issue, consider that half the battle is won. Next, you need to narrow down on why your business might be suffering and think of solutions.
Invest In your Team
An important tip to save business from failing is to invest in your team after you have analyzed your major problem. If you are thinking that your business has failed because of lack of latest technologies, hardware or data, then you have to realize that it is the soul of your business that is most important. Your employees are your most important assets. When the company sales and profits graphs hit an all-time low, you need to re-evaluate your strategy and also the people who execute it. You might be in need of better and more motivated people who can help you revive your dying business.
Do not recruit your team on the basis of their strong resumes, but try to figure out their talents and attitudes. You also need to heave a transparent communication with your team and let them know about your vision and objectives. Give your teams smaller targets with a vision of sticking with you for long-term. You also need to keep their trust and motivation intact, if you want your company to succeed.
Cost Reduction
Cost reduction is one of the last resorts an entrepreneur tries in order to save his business. When all the other options seem exhausted, an entrepreneur can decrease costs by closing down offices in some areas and also reducing on labor costs. You can instead, think about outsourcing employees to replace costlier personnel.
This strategy will improve your attempt to resurrect your business and once you have prioritized your payables, you can assess the cash you are left with and plan a detailed cash flow plan and go according to it. This will reduce the chaos in your business and help you handle the situation better. Managing cash flow is very significant for a business. You should also track cash flows on a weekly basis in order to achieve stability.
Do not avoid communicating with your creditors for delay in payments. Think of a strategy to avail payments from debtors in the form of advance and discounts. You will also have to reduce your labor costs and stop all your useless spending. Ask your landlord if he may agree to reduce the rent for some time. You might also have to take decisions to lay off people and reduce their working hours in order to cut down costs.
Create a New Marketing Plan
After re-evaluating your company, it’s possible to find out where you went wrong. You should be able to redefine and rethink your business strategy. You now need a new marketing plan which can reinvigorate your business. You can take the help of experts to help you chalk out a better plan. What you did before clearly is not working now and so you have got to change your ways.
Sometimes, a failing company might be doing everything right – right product line, right strategies, motivated employees, right pricing, etc. and yet are not able to convince customers for buying their products. What you need to do in such circumstances is to find out the right marketing strategy with the right pitch and right message.
In today’s digital world, social media optimization is very important for the success of your business. Also, you should never imitate your competitors. Try to come up with your own strengths and unique strategies to win your customers.
Don’t Shift Focus – Stay Lean, Hungry and Passionate
Limitless passion is the one element that will help you sail through tough times. While trying to save your failing company, you should not shift your focus to profitability. Profits will come later, first you should make your business stand upright. You need to take a fresh approach for long-term sustainability. Be open to new ideas and new creations.
Everything might just fall into place. What you need is passion, new approach and new strategy, some new decisions and stronger support system of your employees and you will find your company climbing the ladder of success faster that you can imagine.
