Failure is an inevitable part of life, whether or not it will lead to success relies on how we deal with it.
We cannot only choose to talk about success when covering entrepreneurship. There are far more businesses that are failing than succeeding, and small businesses can indeed come and go in no time at all.
However, the majority of entrepreneurs struggle within the first year of operations, due to which start-ups experience business failure. It is best to discuss the reasons for business failure and come up with recovery strategies as part of the business strategy.
I would like to pin down some reasons for business failure –
- Poor Business Conduct – One of the most common reasons for business failure is poor business conduct. New entrepreneurs due to their lack of experience make fatal mistakes which experienced ones wouldn’t. Lack of managerial whereabouts, market-specific experience, and unbalanced management delivery leads to poor conduct and, therefore, business failure.
- Unrealistic Business Plan – A business plan is a guide that specifies the details about how you plan to achieve your business goals. Most business plans are full of assumptions. One of them being, your business will succeed! A bad business plan buries all such assumptions therefore you should always tie assumptions to facts.
- Lack of efficient cash flow – Without consistent cash flow, your business will eventually dry up and die. Entrepreneurs need to know how to make adjustments and keep a check on their finances or they will eventually run out of it.
A successful small business is hard enough to produce with so many other outside factors adding to the challenge. These are a few common struggles of an entrepreneur that leads to business failure.
Here, I’ll share five tips to recover from business failure.
1) Scrutinize Failure
First and foremost is to embrace failure. Understand, its normal to be where you are.
Secondly, reflect on what went wrong and find solutions to the problems that arose. Talk to your colleagues and partners to learn from the mistakes and do things differently next time. This will help you improve your processes and prevent potential failures in the future.
2) Fix your Finances –
Next, fix your personal finances. You know your business is doomed, the only way to survive would be to get a job. This would not only help you to get back on your feet but also give you time to analyze your expenses and keep them in check. In this process, do not forget to keep your team motivated and keep the prep for a comeback on.
3) Align with the right entrepreneurs –
Entrepreneurs need encouragement, guidance, and reassurance when faced with problems. Align with an entrepreneur with a similar background to guide and change you for the better. Use the knowledge and experience provided to enhance your business skills. This will develop your problem-solving skills and help you grow personally and professionally.
4) Grow out of it –
Business failure is stressful. While its always lurking around the corner, it’s not the end of the world. It’s time for you to get over yourself. Use success stories of people who failed their way to success to inspire and motivate you.
Don’t be hard on yourself, talk to your friends and family. Give some time to heal and surround yourself with positive energy. Believe in yourself and do not give up.
5) Start thinking of what sets you out –
Finally, start exploring. Get out of your comfort zone and experiment with fun prospects.
Learn something new, take on a few courses, and attend a few workshops. This will allow you to develop and sketch out a few business ideas. Develop a proper plan and write down your goals. Work on different marketing strategies and choose what works best for you.
You will come across a lot of obstacles along the road, but the fear of failure should not stop you from pursuing your dreams of entrepreneurship. Stay focused, do not repeat your mistakes, learn from it, and move forward. Because you can do this.
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- Entrepreneur Struggles: Tips to Recover from Business Failure - October 20, 2020