9 Steps you Need to Take in order to Turn a Failing Business Around
There’s a high chance that you’ve spent hours of your time trying to make your business into what it is today, and seeing it fail can be heart-breaking.
Luckily, there are a few things that you can do to try and turn things around.
#1 Write a Business Plan
Banks, investors and even management will want to see what you have in store for the future of your company. They’ll need to see the part that they play, and they will also need to know how they can use their own expertise to help.
It’s also a good idea to try and pinpoint why your business is failing so that you can try and resolve those issues first. For example, if you are failing because you have tons of excess inventory then consider selling it back to your suppliers for a discounted price.
If you have customers who are not paying up, then hire a service to get the payments for you. If you don’t know what the problem is then you can’t hope to find a solution.
#2 Discuss your Future
If you are the leader of your business, then you need to get other key people involved too.
Consider having a no-holds-barred discussion on how to fix things. If you want to instil confidence, then try and create a plan of your own before going into the meeting so that you can kickstart the discussion while also proving to everyone that you are in fact the leader you were born to be.
When hosting your meeting, it is so important that you are flexible and open-minded. You may not like the solution that people come up with, but if it works and if it saves your failing company then it’s worth a shot.
#3 Talk with your Employees
It’s so important that you talk to your employees too, rather than just management. They need to know what is happening and they also need to know how secure their positions are.
If you shield them from what is happening, then this will cause rumours to spread throughout the workplace and you may even find that they leave in an attempt to secure their own future.
This will cause your company even more problems and it’s the last thing you need. If you want to stop this from happening, then ask for their input and find out if there are any underlying problems that you need to be aware of.
A toxic workplace is never a productive one, so take your time and make sure that your business is working with a solid foundation.
#4 Inform your Customers
It’s mentioned above that rumours will spread throughout the workplace. They’ll also spread to your customers too, and this may make them wary about buying from you.
If you want to stop this from becoming an issue, then you need to explain your situation while assuring them that you have a plan. This will stop them from worrying and it will also help them to regain the assurance they need to trust in you.
#5 Meet with your Vendors
Your vendors may spook if they find out that you’re having trouble. You need to write a
statement that will help you to deal with them and you also need to tell them your plan too. If your vendors have any questions, then make sure that you respond thoughtfully and quickly to try and give them peace of mind.
Remember that they’re a business too, and they need to be able to count on you as much as you count on them.
#6 Tax Authorities
If for some reason you are unable to pay your taxes, whether it’s federal tax, state tax or county tax, you need to alert the right authority as soon as possible.
You will be on better terms with them when you do, and you may even find that you are given a good level of support too.
If you fail to pay without notifying them then this can cause you major issues and you may even find that you are not able to dig yourself out.
#7 Contact your Bank
If you have a line of credit, then don’t just email your loan provider and explain your situation.
Instead, call them up and ask them to have a face to face meeting. Give them a plan of action and showcase your confidence.
This will help your business to recover faster and it may open up more opportunities for the future.
#8 Only keep Employees who Are Essential to your Business
Find out who you can let go without having a detrimental impact on your business. Sure, letting people go can be tough but sometimes it is the only solution.
When choosing who to let go, try and avoid cutting people who are bringing in or making you a significant amount of money. They will be the ones who’ll help you the most right now. If you cannot stand the thought of letting people go then it may be worth cutting their hours for now.
That way you can save money without having to hurt your company morale too much. When letting people go, try and do it once. If you make cuts throughout your business over the coming months, then this will eventually become psychological torture and it will also make the rest of your team worried when they might not need to be.
If this doesn’t work, consider contacting a manufacturing business broker to see if they can sell your business.
#9 Cut Costs that are Not Necessary
Another thing that you need to do is make a list of all the expenses you have. When you’ve done that, you can then eliminate any that you don’t need.
You really need to buy some time so that you can fix your problems, and this will help you with that. If you are having a hard time doing this then it may be worth chatting with an accountant.
When you do, they’ll then be able to help you to find out how much you need to save.
