Learn From the Past: 6 Steps to Help Your Company Bounce Back From Tough Times
There is a lot of debate over business survival statistics, but depending on who you ask anywhere from 50-90 percent of new businesses will fail in the first 1-5 years. This means that, as an entrepreneur, there is a very good chance that your company will face tough times at some point or another.
Whether you have simply been struggling for a significant period of time, you are forced to declare bankruptcy, or your company fails outright, the hardest part about tough financial times in the business world is usually trying to bounce back.
As they say, if you get thrown from a horse it is important that you get up and ride it again. But what can you do to make sure the horse doesn’t buck you again?
In this blog we will detail six useful tips to help you learn from the past and your company bounce back from financial issues and failures.
1) Hire business counsel
The single most important thing you can do to bounce back and avoid repeating your past mistakes is to hire an experienced business attorney, such as those found at the business and bankruptcy law office of Maxwell Dunn. Business advisory specialists, like those at the law firm of Maxwell Dunn, will help you create a business plan to manage and operate your business by the numbers. They can analyze your past issues and help you make realistic plans to move forward.
2) Focus on the numbers
As we just mentioned, you need to focus on managing your company by the numbers. You cannot just build a company based on gut feelings and good ideas. You need to constantly analyze vital metrics and adjust as needed. The numbers will show you if something is going wrong long before you will be able to figure it out for yourself.
3) Reflect on what went wrong the first time
Take time to take a close look at what caused your financial troubles the first time around. Be honest with yourself. Was your management style an issue? Did you make poor hiring decisions or bad investments? Have those decisions forced you to rebuild credit? Make sure these assessments are based in demonstrable fact, not based on assumptions or guesses.
4) Be willing to change
Change is never easy. We get so used to doing things a certain way that, even when it is clear that those actions are the root of your problem, we oftentimes hesitate to make the necessary changes due to fear, ignorance, or denial. If you want to avoid repeating your past mistakes, you have to be willing to change the things that weren’t working.
5) Cut unnecessary aspects of your company
Also known as “cutting the dead weight” or “trimming the fat,” you should take a look at everything your business does and analyze what is truly necessary. Oftentimes businesses fail because they try to do too much. Focus on the two or three things your company does best, and make those your entire focus. As you grow and succeed in those aspects of your company, and you begin to achieve some financial stability, you can begin to extend your reach and add to your focus and goals.
6) Seek financing from sophisticated investors
Obtaining financing can be an issue if you’ve had serious financial troubles in the past. However, more sophisticated investors like venture capitalists usually understand that many businesses fail, and in doing so the failures provide an opportunity to gain experience and learn from one’s mistakes. In fact, venture capitalists may be more willing to fund a company headed by an entrepreneur with experience, despite a failure, than a completely inexperienced entrepreneur.
Tough times and business failures can be leveraged in many ways to help ensure your new ventures and second chances will succeed. Please contact Maxwell Dunn PLC today to learn more.