Top 3 Ways to Fix a Failing Business
It's an oft-quoted statistic that nine out of ten small businesses fail within the first five years of opening the doors; for those that make it past year five, an astounding number still won't make it to year ten! Being an entrepreneur means not only facing the possibility of failure head on, but also that you need the determination to not let your business become yet another statistic.
One entrepreneurial couple learned exactly that. Philip and Lynn Spry own a computer retail store, and were faced with a decline in sales in 2006, which by 2007 had put their business at risk of closure and their entire livelihood in jeopardy. Instead of letting what seemed inevitable happen, they started reading business books, talking to surrounding businesses, and testing different tactics, all in the name of survival.
A 90 percent increase in revenue later, they had succeeded in saving their store; what they learned prompted them to write the book 19 Ways to Survive: Small-Business Strategies for a Tough Economy. The book includes many nuggets of helpful information, but implies that there are several main things any failing business can do to try to turn things around. Here they are, in no particular order:
3 Ways to Fix a Failing Business
- Motivate, train, and manage your employees: Whether you are your only employee or you employ others, someone is the face of your business. Why entrust your business to anyone but the best? You want your employees to be excited to help the business meet and exceed its goals, and help customers or clients get what they need and leave happy, to return with more business later. Believe it or not, their performance, good or bad, falls on your shoulders. You need to employ good hiring/reference checking practices to ensure you have the right people working for you; consistent training practices to ensure the same high quality of work or customer service out of everyone you employ; and manage your employees in an ongoing fashion, whether that means correcting them when they could have performed better, praising them when they do something fantastic, or firing them if you come to realize they are not the right fit for your company and are doing more damage than good.
- Compete effectively with big business: This includes turning your brick-and-mortar storefront and/or website into a showroom, targeting the right market of people, finding your niche, and learning to adapt to changing market conditions. Don't compete on the big businesses' terms: Stand out in a crowd by selling your industry knowledge (big-box stores won't normally have specialists, just minimum-wage employees)! Always be searching for new products, services, and opportunities that will make you different.
- Commit to making your business a success: Yes, of course you want your business to succeed, but have you fully committed to making it happen? Do not entertain for a moment the possibility of failure; do not hesitate to commit your time and resources to your success. Exemplify the values and ideals you want your employees to follow and your customers to see. Act in accordance with your business plan, and mission and values statements (or rework those if they're not working for you).
Eileen Velthuis is managing editor at North Vancouver's Self-Counsel Press, a do-it-yourself legal and business publishing house. She has written many articles for magazines and newspapers, and is the author of How to Throw the Ultimate Divorce Party, to be released summer 2012.