When you’re trying to get a business off the ground things are never going to go to plan. No matter how long you spent drawing up detailed earnings projections and growth strategies, you’ll soon find that everything goes out the window and it takes far longer than you thought it would to start making a profit. The major reason that businesses fail before they’ve really got started is that they run out of money before they’re making enough sales to sustain the business. If you think that might happen to you, here are some easy ways that you can keep your company from sinking.
Realize Early
This is absolutely key if you want to keep your head above water. Realizing that you’ve got a problem just a few weeks before you run out of cash completely doesn’t leave you long to sort it out. Staying on top of your finances and learning to spot problems before they get out of hand is the best way to prevent any cash flow problems that risk killing your business. As soon as you start to notice a bit of a downturn, start taking steps to rectify it, don’t just wait around and hope that things will get better.
The worst thing you can do in a crisis situation is bury your head in the sand. Nobody wants to admit that their business dreams are falling flat but you can still save them if you get to work soon. Putting it off only makes the situation worse.
Raise Some More Cash
It’s a frustrating situation when you know that you’re on the cusp of a breakthrough but you don’t have the capital to see it through. Getting the money to last just a few more months can be the difference between success and failure. The problem is, when your business is already in trouble, investors aren’t likely to give you more money so you’ll have to go down another route. You could look into business loans for bad credit, the interest rates will be a little higher but your options are limited so you’ll have to compromise. There are also a lot of other alternative lending streams that can help you get out of a sticky situation.
Peer to peer lending is a great way to find investment from people that are more willing to lend to people with a shaky financial history. You’ll still have to be vetted so you can’t lie about your financial problems, but lenders will be more likely to overlook it if they have faith in the product.
Review Your Staff
There’s a lot of reasons that sales might not be growing, one of them is your staff. If they aren’t generating any business, it might be time for a review. Don’t just start sacking people left right and centre to cut costs, that’s not what this is about. Instead, look at who’s bringing in valuable customers and who isn’t. Give them a chance to turn things around but if they’re just dead weight then you’ll need to replace them with new employees that are actually making you money.
When you’ve got a hole in your business and you’re sinking fast, don’t lose hope. You can always plug those holes and get back on track if you take action early enough.
