Try to picture the situation: You have a dream since childhood to be the boss of your own business. You study your entire youth to get ready for your future role as president. You work, save your earnings, drum up a good business plan, plunk all your hard-earned cash into setting the business up - and then you eventually launch it. The problem, however - it's doing really poorly - not even just during the first few months of operation. The poor performance drags on to a year or more. What do you do?
It's truly devastating when the sum of all your dreams decides to suddenly turn into a nightmare. Now that you have all your money and emotions invested into your own business, what could you do to salvage it?
Here are the top 7 things you might want to consider doing.
Schedule a meeting and discuss the situation. Gather all the people and investors/contractors that are involved in your company and let them know about the situation. Closing down is a last-ditch solution, so you must all brainstorm and drum up ways to salvage the company and get it back on track. The more honest you are to all the ones concerned in the running of your business, the better - since everyone can do his own part in improving for the good of the company.
Create a timeline of events that led to failure/poor performance. This is necessary to determine at what point the error was made. For all you know, it may be just a glitch in stocks, sales, or even plain miscommunication…and better still, wrongful accounting. Discussing the cause is important to the discovery of a solution. It is also essential to stopping a problem on its tracks.
Reach out to clients and mentors for advice. This is a common mistake of most business owners - they are too proud to ask for help even when they know they need it. Think of it - it's either you swallow your pride, or you close shop. The decision shouldn't be difficult. Ask customers for feedback - the poor business may be purely due to poor customer service. Don't let them know your company is at the brink of closure, but ask them nonetheless and try to pinpoint form their point of view where the problems may have started.
Develop other streams of revenue. This is to ensure that you don't completely run out of funds needed for operation. Also, you may want to offer additional products to clients which will help boost sales. Maybe your initial set of products was not as interesting as you thought - and that it definitely needed an overhaul/upheaval.
Try increasing prices - but provide additional value. A good way to increase profit is by increasing prices, but to increase prices when at the brink of near failure would be silly if you do not intend to make the purchase more enticing for a client. Try giving bigger portions, or size or quality. Provide irresisting encouragement to customers to plunk down more of their money in your products. But remember - offer something more - don't blindly increase price point for no reason other than "you desperately need to increase revenue.
Cut costs and remove unnecessary systems used by the business. There will be processes which will help your business perform better, but there will be some which are actually pocket-drainers - the advantages of employing them may not be commensurate to the benefits they bring. Map out everything - from top to bottom. Cancel unprofitable processes and age-old practices which contribute less than they should to your business.
Boost employee morale. One of the first fears that will spring up whenever the business isn't doing too well is job security. Your employees will understandably be scared of losing their jobs when you go out of business. Counteract an otherwise excellent job performance from your staff with reassuring words. Tell them that you will do everything necessary to fix the business. Don't make them or their own salaries take the cut when things are not doing well. Remember, when you unnecessarily "punish" employees by having them work longer for less, then you will be faced, not only with a poorly-performing business, but disgruntled employees as well (who may march out the door).
7 Foster a rewarding work environment. Focus on employee morale and retention with bonuses linked to business improvements.
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