How to Turn Around a Struggling Business – 10 Strategies
10 Strategies That Will Help Turn Around a Struggling Business Without Hiring Business Experts You Can’t Afford.
There are many strategic options on how one can approach turning around a struggling business irrespective of the messy and challenging elements that govern it.
The key… a smart approach.
If you have a small business struggling to stay on its feet, I’ve put together 10 strategies that will help turn around a struggling business.
The suggestions are based on Marc Kramer’s book titled Small Business Turnaround.
1. Write down Plans
Knowing what the future plans are for your company is a wise and necessary business strategy.
It helps you understand where everything fits in, what needs changing, and how to come up with new ideas that will help drive the company forwards towards success.
In short, it is prudent to write down your marketing, sales, recruitment, and even operational plans for your enterprise.
Also, find time to come up with an emergency plan.
An effective plan is one that highlights the good and bad of the present and the past to speculate of what the future holds. A well-thought-out plan is a valuable tool for any company, and its actualization should follow its conception. It should not be something that is only done in paper.
Way too many businesses say that they don’t have time to come up with a great plan.
Find the time, because most businesses that struggle skipped this step.
A turnaround for any company, big or small, is a very demanding thing and its execution requires you to have a solid business plan to move forward.
2. Consult with Key Executives
You need to have every key personnel of the company taking part in the turnaround intervention.
Have them sit down together and have a lengthy discussion the strategies that will help turn around your struggling business. Make it clear to everyone that they should not attend the meeting without an immediate plan of action and you, as their leader, should also have one. Overall, everyone should have an open, flexible and self-assured mindset with a single focus of turning the fate of the business around and making it a success.
3. Digital World
A lot of businesses find that they are falling behind because they aren’t embracing the internet and the digital age. We see it everywhere, from small brick and mortars to Enterprise b2b businesses.
The internet has changed things.
Here is a good piece on principles of leading change in the digital age
4. Meet with Employees
Holding a company meeting is necessary.
It is essential that you let it be known that things are not okay with the business. Inform the employees of the plans of turning things around and ask for their views. It is a strategic move that demonstrates to the workers that careful considerations have gone into the development of the plans for the success of the business.
By doing this, you will have a solid team backing your efforts.
5. Meet with Customers
Rumors are a very effective destroyer, letting hearsay spread is the start of the end of your company.
As such, you should make an effort to reach out to some of your loyal customers as well as some of the new ones to inform them of the current state of affairs. Also, use that opportunity to assure them that you are doing your best to fix things.
Do not be deceitful.
6. Meet with Vendors
If you have vendors, take the time to update them so that they hear from 3rd party sources first.
Remember, word travels fast, and it is prudent to alert those out there that are marketing your business. Prepare a well-outlined statement that shed light on the problems and how you intend to deal with them.
Expect a lot of concerned calls; you need not ignore them but respond to them quickly and as thoughtfully as you can.
7. Contact Tax Authorities
If the current predicament has placed your company in a position where it cannot pay its relevant taxes, it is prudent to notify all the appropriate authorities.
In most cases, the tax authorities will do their best to work with you. Moreover, informing them will ensure that you are on better terms with the authorities so that you do not come across as though you trying to avoid the tax obligations.
8. Contact Your Bank
If the business has a line of credit or loans from the bank that it has to honor, you need to inform your loans officers of the state of the company.
As you give them the bad news, ensure that you present your plan of action. Do your best to appear confident about the measures you will put in place to revive things and how working with the bank through the tough times will be of immense help.
9. Reduce Overhead
Figure out which elements in the business operations you can do without so that you cut overall costs and save money.
This could even mean letting go of some of your employees. When doing this, ensure that you only keep those who hole essential positions and roles in the company. Assure them that they will have their jobs back once everything takes a turn for the better. Alternatively, you can opt to cut the work hours for some of the employees.
Most importantly, you need to identify the non-essential employees that you will have to let go; ensure your first cut is deep.
Multiple rounds of this will have a negative psychological impact that may affect the remaining employees far greater than one decisive cut; consequently reducing their productivity.
10. Cut Unnecessary Costs
In keeping the plan to reduce overhead, make a list of what you do not need so that you minimize on expenditure.
The objective is to buy “financial” time to help you divert your finances towards your business turnaround intervention.
All of these things are essential components on how to turn around a struggling business and should hopefully make the vital changes you need to survive and in the longer term to thrive.