The art of business has been propagated by many people not to be an easy one, and that’s the fact. Doing business has a lot of challenges and struggle, which you would have to undergo before you get to success. Thus, as a business owner or an intending business owner, you’re supposed to see business as an art that needs dedication and hard work to master and complete. In running a business, you’ve to know that businesses fail, and having the art of business of how to revive a failing business is a good plus.
You own or intend owning a business then you have to know that a business has higher probability of failing in its first ten year. In fact, statistically speaking, only 10% of businesses established survive after five years. Therefore, a high percentage of business fail, and thus, you’ve to be prepared and brace for the impact.
The issue is not with the business failing but the issue of reviving a failing or a failed business. Businesses fail, and it happens all the time; however, what is your ability to make that business stand and survive the heat? In this post, we’ll be guiding you on the art of business of how to revive a failing business.
Decisions to take on How to Revive a Failing Business
- Strict Financial Management: This is the first decision or step to take in reviving a failing business. You should look at the finance of the business and introduce methods for better financial management. First of all, block all financial loopholes in the business haemorrhaging the business. Then, cut of expenses that aren’t necessary, especially expenditures which the business can do without.
It is best to call a financial auditor and advisor to do an in-depth analysis of the business’ finances and suggest ways the business can be managed better.
- Cut Labor Cost and Uphold a Stricter Scale of Preference: If you’re really serious about reviving a failing business then there are hard decisions and actions you must take to make the business better. One is to cut labor cost as labor cost is usually on top of a business’ high expenses lists. Check for job roles and duties which aren’t adding much to the turn over of the company and cut it off for that moment.
Apart from the labor cost, there are also other hard and difficult decisions you must make to revive the business. This is why it is necessary you involve a financial auditor and advisor to go through all the financial aspects of your business to make those suggestions for you. He or she should be sincere to you and tell you the facts and what needs to be done. Every hard decisions he suggests you should make, please endeavor to keep to them.
- Change the Business Strategy: In order to change the business from one that is failing to a growing one, you’ve to change the business strategy. If the business is failing, it means there are certain things which aren’t right in the business and the strategy used in running the business is one of it. Thus, you should work with professionals in drafting a new plan and strategy that will work.
- Apply for Tax Cut: You cannot be paying taxes fully when your business is failing. If you’re in a location where there is some sort of tax cut granted to businesses from time to time, applying for it at this time is the best. It will go a long way in helping your business. Even if it’s possible, apply for bankruptcy so far it doesn’t mean that government will take over your business.
The government can send investigators to look at the financial books of your business. You can apply for tax cut for the period of time you would be reworking on your strategy, it might be from a year upwards depending on how bad the finances of the business is.
- Change Management: If the business in view is a large business controlled by a management, you might consider changing the management. The management could be the cause of the problem why the business is not moving, possibly their work level is poor and their idea for running the business is poor as well.
Let them understand why you had to let them go, it’s a hard decision but it has to be done. You should settle them well. Next, you’re employing people who can deliver better and with a reduced pay. As the business begins to make turn over, increase their pay and reward their work level and service delivery.
- Reorder your Target Market: As you work on your strategy, you should reorder your target market in case the number of sales of your goods and services is the problem. If the sales is the problem, consider reordering the target market and carrying out a new campaign. For instance, if you aren’t selling goods to meet up your sales expectations due to you sell to a middle class market, then you can target the working class with lowly priced version of your goods and all to make you sell more and bring in great revenue to your business.
- Improve your Business’ Productivity: This is another area to tackle to improve the business’ finances. Even if you cut down on the labor cost and expenses of the business, you can still improve the business’ productivity by increasing the production or fastness by which service delivery is made. Thus, for instance, if your business is a small scale snacks business, instead of producing 50 meat pies a day with a staff strength of 5, you can join and cut down the workers to 3 and you guys produce 70 meat pies, and the level of work should be improved as well.
In the trying time when the business is failing, it is wise to let your workers know the situation, especially those you may drop, and encourage those who you don’t drop to increase their level of productivity to make the business more viable.
- Restructure your Goods and Services: This is an important decision in this our art of business of how to revive a failing business. That your business is not doing well might be as a result of how you lay the structure for your goods and services. Your business might be lacking in having goods and services which aren’t suitable to your target audience or that they are too overpriced. You’ve to check this, plan it well and do it well.
- Improve in the Efficiency of your Business Delivery: All the levels of your doing business should improve like in the aspects of sending goods to customers, your customer service, pricing and all. There should be excellence in your business delivery if you want your failing business revived. It is when customers begin to see changes in your business delivery that they would consider sticking with your business and patronizing you for a very long time.
- Invest more in Sales and Marketing: This is where you put a majority of the limited resources of a failing business if you’re really interested in the art of business of how to revive a failing business. Once you rework your strategy, manage your finance and cut expenses, improve productivity and efficiency, and do other necessary stuffs, the next thing is to invest in sales and marketing.
If you cut down other expenses, don’t cut down that of marketing; it is even as a business is failing that sales and marketing activities should be increased or doubled. You should remember that the more the sales, the more the income and the high possibility of making the business a moving one.
Next, on this post, we’ll be looking at related questions which would also help in the art of business of how to revive a failing business. These questions and their answers are stated below,
What can a business do to Improve Productivity?
To improve productivity, firstly, a business should emphasize more on workers’ dedication to the business and welfare. There should be close connection between the workers and the business and the management. When the workers are happy towards the company, motivated as well, they give their best to the business.
Aside from the workers, what can a business do to improve productivity can also check on the business’ process and procedures of running its daily activities. The business should cut down on the processes wasting time and hampering productivity. Furthermore, there should always be an attempt to make things faster in the business.
How long do you have to keep a business record?
Business records should be kept by a business until that business ceases to exist. Thus, on establishing a business, the first thing you should begin keeping is the daily or monthly account of running the business, especially as concerning the finances. Record keeping is very important in a business. Very very important.
How long do you have to keep a business record should be a big question and factor in your business. The balance sheet of your business will help you know if you’re running the business profitably or at a loss, and it will also help in managing the business well and also influence your payment of tax.
When do small businesses file for taxes?
When do small businesses file for taxes is another important business you should ask yourself if you’re a business owner. Taxes, if not well handled, are one of the things that may wreck your business financially. We encourage you that once you begin to make a good amount of money in your business, you should get a tax consultant to advice and guide you.
For the question, when small businesses file for taxes, especially in the US, is around or on or before 15th day of every month.
Conclusion
Art of business of how to revive a failing business should be what every business owner or intending owner should know and acknowledge. A failing business is not an uncommon situation; it is something you can easily tackle and overcome. Reviving a failing business is very possible, if you know what to do and have the determination to do the right thing to the end.