RX Patient Tools
Use these quick guides before reading the article, or return to them when you need help preparing questions for a doctor.
Starting a business with a great idea doesn’t necessarily mean success. Launching a startup is surprisingly simple, but no one wants a bad start. When a business fails, entrepreneurs sometimes feel that the failure came out of nowhere. The truth is that very few businesses fail without warning. Here are five signs that your business is in serious trouble.1. Low Sales
Low sales are the first and most obvious sign that your business is floundering. This can mean lower than your projections or lower than last year. For companies to succeed, they need to make sales; if sales drop off suddenly, you have a problem.
Turn it around by figuring out what went wrong. Did you introduce a new product that’s missing its target? Can your marketing be improved inexpensively to spell out your message better? Can a problem in the sales or service sector be resolved? You have a limited time to turn it around whatever’s going on, so don’t wait.
2. No Differentiation
A business needs to do something different from the competition to succeed in a noisy global market. Amazon pioneered two-day shipping, and Jamberry offered a fashionable alternative to manicures; Lularoe considered busy moms’ need for comfortable clothing and reminded them that they deserve to look beautiful.
What does your company do differently? If you can’t give a passionate, cohesive answer in a few sentences, you’ve missed the mark.
Turn it around by reexamining your ideal customer and figuring out what you can offer them that no one else can. Make sure your marketing reflects what you do differently than the competition, and always strive to get more done for your customers.
3. No One’s Talking
There’s nothing worse for a business than silence. If your customers aren’t talking, aren’t leaving reviews, or aren’t engaged on social media, then you have a communication problem. After all, if they’re not talking to you, they’re not talking to their friends about you.
Turn it around by understanding why they’re not talking. Are you not asking customers for reviews and reminding them how useful they are, or are they just not impressed enough with your services to talk about them? The two problems have very different solutions—know which one you’re fixing. Ask your customers to connect with you on social media and engage them in conversation about a specific product.
4. Struggles Around Cash Flow
Even though you’re doing well on your company’s profit and loss sheet, you struggle to pay your bills on time or find you have too much inventory and have to engage in extreme promotions to make room for new products. Properly managing your cash flow is the most important thing you can do for your business.
Turn it around with practices like offering discounts to customers who pay cash or within 15 days and only buying the inventory you need, rather than investing heavily in something you’re just positive will take off soon.
5. Saying Things Like “Failure Is Not An Option!”
Here’s the truth of the matter: failure is an option. When the numbers say that 8 out of 10 businesses fail, it’s the worst sort of arrogance to assume that your business couldn’t possibly be one of them. Entrepreneurs and CEOs make mistakes all the time. Why are you exempt?
Usually, new business owners plan how to start a company step-by-step, but sometimes they look up and realize that their business is headed in the wrong direction. They’ll manage to correct course, right the ship, and steer off in a new and smoother direction. But sometimes, it’s too little, too late. Your customer trust is gone, your startup cash is depleted, or you’ve traded too heavily on employee morale, and it’s all over.
In those situations, the way to turn it around is to close things down as gracefully as possible and to figure out what went wrong. Dig deep to discover where mistakes were made and ensure you understand how to keep the same mistakes from recurring.
The next step is to move on. Find the next idea, do a better job of differentiating, communicate your ideas more clearly, and keep your cash flow more consistent. The right vision and timing will happen—unless you give up.
