The Small Business Association states that 30% of new businesses fail during the first two years, 50% during the first five years and 66% during the first 10 years. Many businesses are over leveraged and under-capitalized. Many business owners fail to properly study and investigate the market prior to entry.
The business owners do not write an effective, realistic business plan. If a business plan is written, it may not be properly executed. A poor business development strategy can also lead to the demise of a business. Unsustainable growth and expanding too fast can cause a business to fail, too. If you have a failing business, you can persevere through the difficult business challenges. Assess the reason(s) for your business’ failure. Implement a plan of action to correct or mitigate the reasons for failure. Determine if an investment in an outside service provider may prove beneficial in turning the business around. Attempt to garner new clients and customers who can and will pay retainers and deposits to fund your working capital. Explore the development of new products or services that may be more profitable than your existing product and service lines.
Make arrangements with your suppliers and creditors to extend and/or revised your payment terms. Engage the services on a credible and reputable business advisor or consultant. Determine how committed you are to seeing your business succeed and whether you have the patience and tenacity to build and wait for the upside.
Take a moment for self-reflection: How much longer can your business continue in its current state? What short-term sacrifices are you willing to make for a long-term gain? What low-cost, high-margin products or services can you offer? How can you restructure your business?
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Nicole Michelle
Finance and Money Wiz
April 15, 2022
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