Keep Your Business Alive with these 6 Steps
31 July, 2019
All businesses go through difficult periods, but when times are tough, profits are down, or you’ve had legal action brought against you, it can be easy to panic or feel like control is slipping away from you. There isn’t a standard set of rules on how to turn things around as every small business is unique, but there are some general steps that business owners can take to keep their business alive when it seems to be on a downward trajectory.
Here are six steps you can take to keep your business alive through hard times.
Make sure you have insurance in place
Having the right insurance in place is vital to making sure that your business can survive. For example, the insurance provider Hiscox, highlights how essential it is to include adequate employee liability insurance to protect you financially should an employee make a claim against you. Having the experts dealing with this means you can continue to keep your business running as smoothly as possible.
Treat the cause, not the symptoms
When things start to go wrong, it’s natural to want to steam in and change the most obvious issues. While that approach has its place in some situations, it can often be more useful to take a step back and look at the bigger picture. Significant business failings are rarely down to only one thing and may have been caused by several different factors. Your overall business model will have both strengths and weaknesses, which and lasting change will come from taking a top-down approach. If employees are repeatedly making mistakes, there’s a chance that your training is insufficient, their line manager is failing, or you have an issue with the inefficient procedure. By addressing the real cause of the issue and not simply putting out fires, you can make a lasting and positive impact for the future.
Carry Out a Staffing Review
One of the biggest outgoings in a small business is payroll, and you need to ensure that the wages your paying are being spent on the right people. Consider conducting a review of your staff on a regular basis – not just when profits are down – to ensure your staff are motivated and effective. While some business owners will try to save money by paying lower wages, this can sometimes mean that you end up with disengaged and unskilled staff, which can lead to inefficiency and loss in the long term.
Source Short-term Funding
It can be a good idea to ensure you have a fall-back plan should you have cash-flow problems. This could include taking out a bank loan or a line of credit. You may also have savings, stock holdings, or family members who could help you out in hard times. You don’t need to take the cash out or use the card, but simply knowing that the option is there can be a great mental boost.
Get Into the Details
While you need to have the bigger picture in mind, it’s also useful to think about the small issues which – when you consider them all together – could be contributing to a drop in performance. Are you paying too much for office supplies or ineffective marketing, or are employee expenses getting out of control?
Don’t Sacrifice Quality
There may be a problem with the quality of your service or product. If this is the case, this needs to be addressed with the cooperation of everyone in the business, but don’t rush in making significant changes without giving it thorough consideration. On the other hand, some businesses may try to cut costs and improve profit margin by changing to cheaper components. However, lowering the quality of your product could damage your reputation with customers, lead to returns and, ultimately, fewer sales.