Data from the Bureau of Labor Statistics (BLS) shows that two-thirds of small- to medium-scale businesses with employees survive for two years, while around half survive for five years. These statistics mean that of all the hundreds and thousands of new small- to medium-scale businesses popping off every year, most of them fail over time.
Whether you’re a small manufacturer, retailer, or service provider, every business is at risk of failing. However, if you’re starting to see clouds looming on your business’s horizon, don’t panic as there’s still a chance to save it.
Here are six small business survival strategies to ensure your business stays up and running:
Assess Your Business Situation
You can’t create a survival plan without knowing how much of a problem your business is facing. Sit down and make a plan for what’s happening, and be creative to truly help your business—and not just give up and say yes to everything your advisor suggests and end up with even more problems.
Assess your cash flow for the next year and see how your costs compare with your potential income and determine if there will be a time when you’re going to face severe cash shortages. If you want your business to survive long-term, it needs to overcome any cash flow crisis it faces.
If you’re willing to risk it, you may even need to call a mortgage broker and get a new mortgage on your home.
If you don’t get rid of the unnecessary costs your business is wasting on, you’ll significantly hamper your chances of long-term survival. That’s why as soon as you see a decrease in income or any issue arise, assess all areas of your operations and find ways you can remove inefficiency and unnecessary costs. You can cut costs by negotiating with your suppliers or exploring cheaper alternatives, such as buying things in bulk from factory outlet stores instead of retailers. ;
Reinvent Your Business
A brilliant way to cut costs while improving your business operations is by exploring no-cost methods to enhance what you’re currently offering. You can make the changes by seeing what your clients are looking for, updating your items to cater to those requirements, or simply introducing new products or services dedicated to those demands. Although it can be intimidating to incorporate something new into your operations, especially when your business is suffering, don’t rule it out. That’s because as other businesses fail, there could be better opportunities for yours.
Reassess Your Marketing
Although dealing with a failing business can be challenging, never stop any marketing activities. However, it’s best to go down the cheaper route for this aspect to save you money. Fortunately, promoting your business on massive social media platforms like Twitter and Facebook is relatively easy and free, so take advantage of that.
However, if you can’t afford to run marketing campaigns digitally, consider going back to the basics like doing door-to-door leaflet drop.
Seek Professional Advice — Now
Remember that there are always people out there that can help you with any problem. There are many sources for free support and advice from local organizations like Small Business Development Centers. Advisors from these places are usually experienced in helping small businesses overcome problems. However, if you’re looking for more tailored advice, hire an accountant.
The key to changing your business for the better and rebuilding your profits is determining what needs to be done and seeing the effects of each change on your business’s cash flow, sales, and profits. Then prioritize those changes by seeing which can increase profits the fastest and secure long-term business growth.
When you implement these, you’ll be keeping your business afloat while ensuring continuous growth over time.