Read Time: 3:58 minutes
I often get approached by entrepreneurs who are facing significant challenges in their businesses. By significant I mean – They’ve dug themselves into a hole so deep that they’re going to go out of business if something doesn’t change! So, my first piece of advice courtesy of Will Rogers , the American humourist is, “When you find yourself in a hole, quit digging!
As far back as I can remember, I’ve always been the person called upon to help fix a situation. For the less urgent ones, I’m more of a troubleshooter, as I usually had some time to assess the problem or problems and then sketch out a game plan.
On the other hand, when I’m approached by an owner with an urgent challenge, I usually take on the role of a firefighter. This is because the situation is critical and there is no time for naval gazing and strategizing. It’s a time for action. It’s more akin to a scorched earth approach, whereby nothing is sacred.
Got the t-shirt
It has been my experience, that in these situations to do anything less is not an option and speed is of the essence. These situations are usually long in the making but typically ignored until they become a full blown crisis. To an outside observer, you would wonder how it could have gotten so bad? But until you are in the thick of it, you’ll never really understand how these things happen. Been there, done that and I’ve got the t-shirt!
Of course, we’ve all read those inspirational books or articles that tell you to stick to it and persevere no matter how hard it is. Or, that suffering is the price you pay to be an entrepreneur. So, I want to tell you that there’s a limit to how much misery, you must put up with.
Unfortunately, when many of us are faced with business destroying crises, we tend to develop a bit of tunnel vision that limits our ability to see all the options available. Couple that with our desire to succeed, plus a little pride and ego, we don’t even consider any of the negative options that can effectively gut your company and your dream.
Strangely enough, when talking with these clients many already know what they “should” do. They just can’t bring themselves to do it, preferring to carry on hoping and praying that the situation will improve. Regrettably, it rarely does.
5 Survival Tips
If survival is your goal, then you must make the hard calls. The first of which is to reduce all your expenses, regardless of how uncomfortable you are. We’re talking survival here. The following list can get you thinking of some of the drastic measures you must take:
1. Move your business. Relocate to your residence or some other free or less expensive space.
2. Cut staff. Payroll is usually the largest expense a company has. Not a fun exercise but a necessary one.
3. Cut all non-core expenses. I mean everything. Nothing is sacred. Cell phone, copiers, coffee service, cleaning services. No more client lunches. Absolutely everything gets scrutinized.
4. Dump unprofitable clients. If you don’t know who they are, figure it out immediately. Deal only with those clients that are profitable now and pay promptly.
5. Streamline your product or service offerings to those items that are profitable. With reduced staffing, you probably won’t be able to support more than a couple of core services. So, do the stuff that makes you money.
Yes, I can state categorically, this is an painful and humbling process. But if you think the business and your sanity is worth saving then you have absolutely no choice. Once completed though, it’ll feel like a huge weight has been lifted off your shoulders.
Many who have gone through this and survived have felt rejuvenated. It’s like they’re in start-up mode all over again and what they discover is that this is their happy place.
So, if you ever find yourself in a hole, quit digging!
I’m Greg Weatherdon and this has been your Small Business Minute.
You may also enjoy The Fear Of Decisions
Copyright © Greg Weatherdon 2018
Sign up above to receive email notification of the latest update to this blog.