Starting a business is a risk you take and a leap of ‘faith’ hoping that all works out. But what happens when the business you started finds itself among the percentage of failed businesses? Some would give up on their entrepreneurship dream but others would keep pushing and try again.
The thing about starting a business is that keeping the business running is not a guarantee. This is especially true for first time entrepreneurs as most lack enough business management experience. Some put in the work but still end up shutting down after a while for one reason or the other.
Business success or failure can be influenced by internal and external factors. Oftenly, some of these external factors, mostly because they cannot be controlled create situations and choices that might be a roadblock to your business. Even some of the internal factors can be a roadblock to your business’s success.
Failure can sound bad and feel like the end of the world but it can be a new beginning for your business. And the beginning will be marked by accepting your business venture has failed and purpose to learn from it. A failed business does not have to stay that way as you can always rebuild it.
Figure out how you got to failure
The first step is getting to know how you got to where you are and it’s basically analyzing your business failure.
Know what led to your business failure and see what you did or did not do. Once you retrace how you got to failure, you will be able to figure out the mistakes you made or the factors that led to your failure and what to work on as you start to rebuild.
With business failure, most of the causes are common among businesses and very identifiable. Get to understand these common business failure causes and asses your business. See what caused your business failure and figure out the choices you made that led to these causes.
Once you do that, you will know what to avoid in future.
Plan your finances
Once your business fails, you no longer have the ‘cash-flow’ you had when your business was running.
If you operated your business full-time and never had an extra source of income, you will no longer be able to rely on your business as your primary source of income. This means you have to find a way to put your finances in order. You will need to work with what you have in your personal savings while looking for ways to increase your finances.
Most of the time, entrepreneurs tend to use their personal savings to salvage their failing businesses and end up losing it all.
Analyze your financial situation and your expenses. You will need a new source of income and if you are planning to get back to business you need to find ways to save up.
Network with other business owners
When your business fails, it should birth a desire for you to do things differently. As an entrepreneur, you should learn from other entrepreneurs.
Get to place yourself among as many entrepreneurs as possible. Join social media groups, attend networking events online and offline. Or, go the traditional way and introduce yourself to other business owners.
Interacting with other entrepreneurs and sharing your experiences with them as they share theirs helps you get new ideas and see new ways of doing things. You will see new ways to deal with issues and importantly you will get a support system for your business.
Take some time off
Running a business is not an easy thing to do. In simple terms, running a business is demanding. It will drain you occasionally as many entrepreneurs put in many hours a week to get their businesses running.
When you lose your business, things can be tough for you. And, you might find it difficult to get yourself together. However, it’s important for you to get yourself together and regroup your thoughts as you figure out what you want.
Consider spending time discovering new interests, hobbies and work on other personal projects that are not business related.
Taking some time off gives your mind a break and puts you in a mental space to come up with new ideas. It also prepares you to be able to go to the next chapter and in this case, probably rebuilding your business.
Back to the drawing board;business planning
Rebuilding your business takes you back to the drawing board. It’s time for a new business plan that suits your ‘new’ business.
When you feel ready, consider spending time thinking about new business ideas. As they say, if you are cut out to be an entrepreneur, one failure cannot stop you. Giving up after one failure, or two, or three, is not an option.
Evaluate all your business ideas and choose the most promising ones. Come up with a prototype business plan for each promising idea.
In the process of dealing with business failure and rebuilding your business dream, take advantage of your experience.
Don’t end your existing business relationships. These relationships will be valuable when you decide to get back in business.
Remember to reflect on the mistakes you made in your previous business journey and purpose to learn from them.
The best thing is that you will be starting your new business journey with more experience. And adding a new plan to your experience increases your chances of success as you start your new business.