How to save your small business from collapsing
Small and medium enterprises are without doubt the foundation on which bigger firms thrive. Many small businesses suffer due to certain factors such as poor capital which often makes a small firm incapable of competing in a capitalist economy. Some businesses fail to withstand the challenges associated with day to day transaction, they fold up at an early stage and fail to live up to set targets projected during startup. It is important to note that there are steps that can be taken by an entrepreneur to address problems threatening to collapse his/her small business.
Identification of problem
Your small firm might be suffering for numerous reasons. Maybe, a competitor or multiple competitors have entered the same business line and are fighting seriously to take your own share of customers which is no good for business. The problem could equally be failure of your business to keep with changes in the market. Taking an objective look at your business could be tough but it is worth it and must be done. You have to start by remembering times when profits were up and sales were strong. Pose certain questions such as: When did this change? Do you have a new competitor? Knowing the problem is just half the battle, narrowing down the factors as to why your business is unstable and focusing on how to fix the problems identified is a great step towards saving your trade.
As an entrepreneur who is understudying a business or getting familiar with it, you are bound to hear and be told a lot from the founders or other coworkers about problems that abound, or the news about challenges confronting them in the trade, what their issues are or what they need to do. Most times, people analyze a business and provide the answers or the solutions without really knowing the business intimately. When you pay less attention to negativity, the secret to a company’s woes are easily noticed.
To ensure success, the needs of your customers should come first. Your customers will not look elsewhere if you are giving them what they need. It is advisable to ask your customers what they want if you are not entirely sure. You have to fully understand and meet the expectations of customers; they should know why you are the best choice for supplying it. Also, checking in with customers is without doubt a good practice for any firm, struggling or stable. It is great medium for you to assure customers of your readiness to maintain them in business. There are various cheap means of reaching new and existing customers. Direct email is one of the least expensive ways to reach your audience, social media platforms such as Facebook, Twitter, Instagram, are equally avenues of meeting new customers.
Motivating your workers
No doubt, your team of workers has played a very significant role to get your enterprise to this critical point. You have to seize the opportunity presented by the challenges confronting your business to transform your staff into an asset. The problem could lie in the fact that your employees do not understand your business model or the entire venture. Some of your workers might just be there for the paycheck which is not good for business. You have to find a way to motivate staff to improve commitment, make them understand the situation on ground. Needless to say, nothing grows an enterprise like having a dedicated and committed team working wholeheartedly towards the success of your business.
Revisit the drawing board
Tracing the root of a problem is a great step towards solving it. Your business did not start collapsing overnight, there must be reasons as to why your business is regressing. After finding out why your business is failing, you have to do something about it geared towards reviving the business. Pose some hard questions to yourself such as: Are you paying more salaries than your revenue can carry? Do you need to lay off some workers to balance economy? What is the next step to take? If you can answer these questions, your business could be back on its feet.
Setting new goals
At this point, it is clear you need new drive and motivation to be back in business, setting new goals that are clear, definite and specific is not a bad idea. Your new goals does not have to be much, craft a select few and vigorously pursue them until you hit your target. Having too much objectives at this level might negatively affect your business. It is equally important to note that your goals must revolve around marketing and making better sales. Researching to see if you are qualified for grants from the government or agencies to boost the financial wellbeing of your business.
Sometimes you have to make certain sacrifices to remain in business and eliminating all discretionary spending is one. Expenses on weekend outings or parties have to be cut off for the mean time so you can save your business first. Reducing cost on necessary expenses is another major way off adding up to finances available. For instance, look out for airlines that are cheaper compared to the one you patronise for business travels and channel savings into the business.
Plan effectively for your assets
Assets may be the only option left to revive your collapsing business, they are meant to yield money for your business and when things are not going well, you have to trade your assets to be fully back competing and trading with other investors. However, an entrepreneur must be sure and fully convinced that selling assets is the best option left before taking such step. It is not something you should be hasty about to avoid the risk of loosing out totally. Many businessmen fail to be creative when they face financial difficulties because they are certain of the amount they will generate from the sale of assets. This is not a great idea; a good entrepreneur is creative and should only resolve to sale of assets when there is no other choice.
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