It happens. Businesses get into trouble. You find yourself in a cash crunch. You can’t pay your bills or worse, you struggle to make payroll. It is a tough spot to be in.
Business is fun, yes but what happens when your business begins to fail, what happens when you no longer make a profit and you are dipping into your savings?
What do you do to keep your business floating and well? How do you?
1. Cut costs
To stay in business, you will likely have to reduce your costs. First, eliminate all unnecessary spending.
Unfortunately, this may involve harsh decisions like slashing salaries or even laying off workers just to keep the business floating.
2. Identify Problems
Narrow the focus of the problems the business is experiencing. For example, if a competitor enters your market and offers a better product or lower prices, one of the main issues of your business’s failure is an inability to compete. In this instance, put your focus on matching prices or promoting quality of service over price.
If your main problem is a slowdown in business, evaluate the effectiveness of your sales force and the nature of your marketing and advertising approach. Identifying key areas of business problems can help you focus your turnaround efforts.
3. Create a new marketing plan
Are you making the most of social media? Is your website optimized and appearing in searches where customers are trying to find you? Perhaps you overestimated the market size or your market research was poorly executed.
A new marketing plan can reinvigorate your business by giving you a blank slate. What you were doing before clearly wasn’t working, so a fresh marketing plan that tries new things just might get your business out of a rut.
A rebrand isn’t generally the first thing business owners think about when sales start to plummet. But sometimes, when products and businesses aren’t positioned properly, a rebrand is necessary to solve that problem.
A rebrand that will successfully jump-start your business isn’t going to be as simple as changing your logo. Your entire brand’s approach to how it positions itself in the market will need an overhaul to see a major impact.
5. Seek external funding
Some business ideas just require a little more push before they break even and become profitable. If your business is dying due to a lack of adequate funding, find people who can fund your business. If you can’t find business partners or investors, find those who would wish to help you and save your business by lending you a few funds.
In this kind of situation, banks don’t work because they see it as a risky investment, rather seek alternative sources of funding such as angel investors and VCs. Angel investors and VCs are the backbones of some of the companies such as Facebook and Google. Without them, these businesses might have failed due to a lack of revenue in the early stages.