Running your own business can be exciting and freeing, but also requires perseverance, and sometimes the economy just doesn’t cooperate, regardless of how hard you work. If you’ve seen a downturn in your profits and have accumulated debt that you can’t keep up with, you may be considering business bankruptcy. But I’m here to help you consider some alternatives that could keep your business afloat.
Assessing the Situation
Before starting a business, it’s important to have a solid business plan in place, and during times of financial difficulties, it’s a good first step to re-evaluate your plan. Take an inventory of the most profitable pieces of your business, and consider cutting out any services or products that don’t give you a good return on your investment. While you may want to grow your business, this might be a good time to wait on purchasing any new equipment or making new hires; you may even need to think about making some staffing cuts and eliminating overtime, while taking on more duties yourself. Some companies get creative with the ways they reduce spending, and decide to decrease spending on employee benefits; even cutting out “free” parking, coffee, donuts, or staff lunches could save you money. For many people, health benefits are a must, so do everything you can to keep your employees’ health insurance, even if it means they may have to pay higher premiums or co-pays. You may be able to make this up to your employees by offering other perks that will benefit them without costing you money, such as flexible schedules or telecommuting options.
Businesses that don’t have a storefront or depend on customer foot traffic might consider relocating to a smaller or more affordable office space. Depending on the business climate in your area, you may also be able to negotiate your rent with your landlord; they’d usually rather decrease their profits a bit than lose a good tenant. If you’ve acquired some business debt, work with your creditors to see if they have any payment flexibility or other options for you. At the same time, if you have customers who owe you money, be sure to follow up with them to see if you can work out a plan that will allow them to start generating some revenue for your business. Another way to generate some new income is to use creative marketing options such as social media promotions or offering small discounts to attract customer attention.
A New Start
As much as business owners usually hate to think of it, there may come a time when it’s simply best to shut down the business altogether. You may decide to have a huge sale to bring in some money to close out the business, or if you don’t have an inventory of products, decide to close the business and move on from there. This doesn’t have to be the end of the story for you; the economy could turn around and give you another opportunity to run a business, or you may start a new career that’s more profitable and fulfilling.
If you’ve done everything you can to keep your business running and get your debts under control, but are still struggling, bankruptcy might be the best option for you. Let’s get together to talk things out and come up with a solid plan to get you back on your feet.