If you believe the statistics small business failure is a common occurrence and there are many different reasons why businesses may fail to reach the five year mark.
Some of the most common causes of small business failure are poor management, expanding too quickly and a lack of financial skills (too little cash in the business or simply not understanding their real financial picture)
Some business coaches specialize in business turnarounds. However, their success is mainly dependent on the skills of the business owner and their willingness to face up to what needs to change and to put those changes in place.
"Most people spend more time and energy going around problems than in trying to solve them" Henry Ford
Whilst the business coach will help identify what needs changing and facilitate the process, they won't actually do the work.
It will still be the business owners responsibility to make it happen.
Business turnarounds are risky for business coaches to take on because there's no guarantee the business owner will get the results and be able to pay their bills!
Consequently they are likely to have a strict criteria for deciding whether or not it's worth the investment of their time.
Businesses don't just start to fail out of the blue. There is usually a trail of warning signs that have not been paid proper attention to along the way.
Some of these include:
Business Coaching Insight:
When problems occur do whatever is necessary to make sure they don't occur again
There are potentially numerous reasons why a business will start faltering including:
As a business owner it is essential to acknowledge and deal with problems as they occur so they don't fester into horrible big problems later.
There is a subtle distinction between solving problems and fixing them.
If you fix it you just sort it out right now but if you solve it you do whatever it takes to make sure it never happens again.
Small business failure is usually the result of an accumulation of smaller problems that haven't been dealt with.
The immediate turnaround strategy of a business that's in trouble should be to focus on:
When small business failure is a very real possibility nothing should be off limits.
Successful business turnarounds require swift decisive action and an overhaul of the way the business operates. BIG goals are needed with a detailed action plan and accountability for making it happen.
If you hire a business coach they will look in detail at every operation of your business and question what you’re doing. In many ways it’s easier to face this process with an outside party – business owners, like most human beings, resist difficult truths and change.
Business Coaching Questions: