So you have to close up shop….
I remember when I was closing my store, and did a google search while holding a Red Bull in one hand and fighting back tears, and ignoring emails from my asshole investor, and I could’t find anything. Why was that the case? Statistics tell us that 50% of businesses don’t make it within 5 years, then why isn’t their any advice, but more over any resources on how to do it, so Uncle Sam doesn’t come after you, how to talk to your employees, how to communicate that to your customers and clients and most importantly how to bounce back.
It’s ego check and gut check time. Everybody has a dream and many people take that dream and turn it into a business. Being an entrepreneur has many benefits and it can be very rewarding. However, opening up your own business is not without immense challenges that everyone likes to gloss over. I hate to be the downer who suggests that you will be in the statistic that fails, but it is always important to know how to handle a start-up business possibly failing because no one likes to talk about it.
How to Save Yourself with a Losing Business
- ASK FOR HELPThe most important aspect of business success is learning how to honestly communicate with your investors, stakeholders and employees. It does not help you or your company by lying or fudging the numbers. Be completely honest with status of your business. Your employees, stakeholders and investors will then have the opportunity to help you through your challenges and celebrate in your triumphs. If you are continually lying about how your company is struggling, then it might be too late by the time the stakeholders realize the real situation and that your company is actually floundering.
If you realize that your company is not going anywhere or is failing and not the silicon valley version of failing where you will eventually pivot and have this amazing epiphany of lessons learned using other peoples money but, you are about to lose your house, the shirt off your back and are literally at the end of the rope it might be time to throw in the towel. Don’t wait until you are in massive amounts of debt or you have $0 in the bank to realize that there is something that needs to happen. If you wait until you are in the hole then most of your options of leaving the business will be off the table.
- Find a Sacred Space: Putting yourself out their and following your dreams is hard, gut wrenching, and has it’s own unique challenges. Closing a business, in these times with social media, means that this is a very public failure that you will be answering questions about for the rest of your life. Take the time to find a place to get some silence and clarity on how to handle things but most importantly make sure that you are okay. If you are religious or spiritual find that place and spend that time to cry, pray and then push forward.
- Help your Team: Although it is devastating for you to be losing your business. You have to consider that your employees are now out of jobs. They put their trust in you and your business and so it is not acceptable to leave them high and dry. You have a moral obligation to find new jobs for your employees. At this point you should call competitors and suppliers to see if there are places for your employees to find new jobs. Write recommendation letters or be positive referrals to allow for the best chances of employee success.
- Buyers: Although you are struggling with your business it doesn’t imply that your business is worthless. You might just not know how to scale it properly. You should make a list of all of your competitors and figure out which one of them might be interested in buying your company. You should start approaching these companies to see if they have any interest in buying your business and taking on your employees. Also consider hiring a broker to help you find potential buyers.
- Create a List of Ideal Customers and Supplies: You might instantly get frustrated if none of your competitors are interested in buying your business. Just because they don’t find any interest it doesn’t mean that you are out of luck. A good option at this point is to see if any of your customers or suppliers are interested in taking over your company. You never know if they are seeking to get started on a business in your industry.
- Sell Your Assets: So you weren’t able to sell your business to anybody? Don’t panic yet, you still have options! Believe it or not, your business might have some very valuable assets that people might be interested in purchasing.
- Patents: Your Company might have generated unique technology or have created patents. There are several companies that specialize in buying patents, or you could ask your competitors if they are interested in a patent you may have.
- D.R.E.A.M- Data Rules everything around me dolla, dolla bills ya’ll Yes let’s channel a little Wu-Tang Chances are you have accumulated tons of data through your business that other flourishing businesses or start-ups might be interested in purchasing from you.
- Sell Your Sh*t: Your final resort is to sell your inventory. You could sell your inventory to competitions, suppliers and customers. Even if you have to give huge discounts it is better to sell your inventory rather than sitting on it.
A Setback is a setup for an awesome comeback! Don’t be ashamed of your business closing. You worked hard. No, your company didn’t go where you wanted it to go, but that doesn’t mean that you are a failure. It is way more important for you to accept the fact that you are struggling rather then burn all of your money and end up in lots of debt. Accept the failed attempt and move on with your life. No, that wasn’t your success story, but maybe your next idea will go where you want it to go!
If you need more motivation on how to bounce back peep my video on what to do when your Startup has F-ed Up