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Experiencing major financial business setbacks is not an uncommon occurrence. In fact, there have been many successful entrepreneurs who have managed to bounce back better than ever. So, if that’s you, and you can’t imagine starting over again, here are some helpful tips from Your Tax Matters Partner to show you that you can.
Don’t let history repeat itself
Suppose it was your budget that you didn’t stick to well enough that steered your business off its intended route. Or maybe it was not being strict enough in managing your cash flow. Whatever the reason for your financial failure, it’s vital to identify the root cause of your business’s failure first and foremost, and then do your best to avoid what went wrong in the first place.
This is especially true if your previous venture ran into debt issues. You want to be sure that any debts that are legally tied to you are resolved.
If you plan to seek funding from lending institutions, it’s wise to check on your credit score and credit history beforehand. Lenders will use this information when determining your loan worthiness, so knowing what they may find is valuable information to have.
Don’t take financial setbacks too personally
While it may be easy to blame yourself entirely for the failure of your previous business, it’s vital to remember not to take failures like these too personally, as they can prevent you from moving forward. Furthermore, confidence in your entrepreneurial abilities is a quality you’re likely to need the most if you want to succeed in business, so it’s important that this doesn’t take too hard of a knock.
Always keep your eye on the competition
In business, it’s vital to always keep your eye on the competition if you don’t want to be beaten at your own game. After all, if you’re overly focused on what you’re good at, you may be blindsided by a competitor with a similar offering to you but with a competitive edge that makes them the preferred business over yours. Moreover, once this lead has been established, it can become increasingly difficult to catch up and this could prompt you to start spending more on advertising marketing campaigns which may still not yield a positive investment anyway because your business has lagged behind for too long.
Have a budget and stick to it
There is a reason why sticking to a budget in business is very necessary. A budget is basically what you envisage your income and expenses to be. More importantly, a budget ensures that you don’t deviate from the original plan. But perhaps you didn’t really see the necessity of strictly adhering to your budget the first time around. Or maybe you didn’t have a comprehensive budget in place at the start of your entrepreneurial journey to do so, then there are budget templates you can download online to ensure you’ve covered all the basics.
When budgeting for staff, you may be tempted to use a staffing agency to source candidates. A staffing agency can be helpful in some circumstances, but compared to a staffing agency, this solution can provide better results at a lower cost. Your own Talent Scout can source highly qualified candidates to fit your business’s short-term needs with contracts as short as one month. This can definitely help you stay on budget.
Err on the side of caution next time
Certainly, as a business owner, you will be willing to take risks in order to realize opportunities. Here, it’s more about evaluating those financial risks that are likely to be profitable versus those that are not as certain. Of course, it is a good idea to research the different risks your business can potentially fall into such as operational risk, market risk, or liquidity risk to ensure you know the pitfalls of each.
On the other side of the coin, if you want to increase your profits, you have to reduce costs where necessary. For example, cloud computing can save you a portion of your IT expenses because of the accessibility of storing documents online to which the relevant people have access. Another example is saving on stationery costs with online document management.
In conclusion, making a success of your business after experiencing financial failure is going to require figuring out and solving where you went wrong in the past to ensure your next business comes back bigger and better than ever.
Amos Faulkner wants to help people “do money well.” Money is a constant in our lives. Yet, as a bank teller, Amos realized that many people don’t pay enough attention to how much they have or how much they need, now and in the future. Well, now, the buck stops with his site, domoneywell.com. From teaching your children how to manage their money to saving for your golden years, Amos will cover it all.