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Business Survival

3 Signs That You Should Shut Down Your Business

It’s not an easy decision, but sometimes circumstances dictate it’s the right thing to do.

Deborah Mitchell

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I haven’t spoken to an entrepreneur yet who has not thought about walking away from a business at one time or another, especially if the business is only a few years old. The grind, lack of money and pure fatigue are usually the top reasons why business owners are ready to throw in the towel.

Rene Syler, CEO and founder of lifestyle brand Good Enough Mother, discussed in a recent blog post that she is still surprised when people complain about how much work is needed to build a brand:

“This is hard! It’s supposed to be. If it wasn’t, everyone would be doing it. There is not a timeline, no expiration date. You just have to keep going until it pays off. Or quit.”

Making the choice to quit your business is not an easy one. Owner and publisher Julie Wilson made the difficult decision this spring to close the doors of her Kentucky lifestyle magazine, Story, after almost four years.

We-recommend-tickRecommended: To Survive Your Business Must Try New Things

 

“My passion for storytelling was no longer what was driving my business, and therefore, it wasn’t honest,” she says, adding that she knew it was time to let it go.

If you are business owner who is not sure if it is time to shut your doors, here are Wilson’s telltale signs that it might be time to close up shop.

1. You don’t recognise yourself anymore

As a business owner, you want to be a better version of yourself. You may be a little different, but not completely unrecognisable. Wilson says she eventually morphed into someone she didn’t know anymore.

“I realised that toward the end, I was working so relentlessly to save the business that I had become a completely different person,” she says.

“I was no longer the wife and mother I wanted to be. The business version of myself was a bit uncomfortable, though. The Julie I knew would never be using terms like ‘P&L statements’ or ‘accounts receivable,’ but I did what it took. I drafted a real business plan, then a working strategic plan, and all of this has to be referred to on a regular basis to make sure you stay on track. The snowball effect takes over, and you just try to stay one step ahead of it.”

2. It’s too much to handle

As a business owner, you cannot and should not do everything yourself. It is a recipe for disaster. A business needs someone to plan present and future strategy, handle day-to-day projects, market and promote and handle the finances. If the business is expected to grow, then you need a bigger team.

“For the majority of the time we were in business, we had a daily staff of two that did everything from sales to publishing,” Wilson says.

With such a small staff, she admits that “marketing got the shaft.”

“One of the heaviest facepalm moments that I still struggle with is that we received a huge order for our last issue (more than double the number from the previous issue), but we were just too small to meet the demand,” Wilson says.

“We created a champagne product on a watered-down Pabst budget, but in the end, there wasn’t even enough beer left.”

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3. The thrill is gone

woman-stressed

It’s thrilling to say that you own a business, to hand out your cards and to find your website in a Google search. But the business of running your business can eventually take toll.

As the boss, you are responsible for everything, including producing goods and services, payroll, providing health benefits and good customer service.  It’s a lot to juggle and maintain.

“I am a journalist by profession, but as the owner, the business side took more of my time than the creative,” Wilson says.

“In the beginning, it was exciting – like I was doing research for an article about what a CEO looks like. Quickbooks, payroll, revenue reports – I learned all of it. I always felt like my type A/creative personality was a slam-dunk for playing the role of business owner. And I still think it is – I mean, I won the 2014 NAWBO Small Business of the Year Award – but when the business demands started overshadowing the time I could spend developing content, the creative spark was growing faint.

“When playing the role of CEO becomes a façade and not just a part of who I am, that’s a telltale sign,” she continues.

“One area where I have stayed true to my personality is that I am one gutsy broad, and it took as much guts to call it quits as it did to start the business. For the first time in 15 years, I will not be working on a print magazine – and I’m OK with that.”

For some entrepreneurs, quitting is not an option. I circled back to Rene Syler, who has been building the Good Enough Mother brand for the last 10 years and asked her if she has ever experienced any of the above signs.

“Yes, I have. Every single one of them. But they typically plague me when I am tired or stretched too thin,” she says.

“How do I handle them? I put myself in time out. For real. I understand that what I am doing, building a brand, takes time. Building anything of value does. So when I feel myself getting burned out, I take a step back, understanding that this is a marathon, not a sprint.”

Syler also believes in measuring your success in realistic terms.

“Sometimes, I take a look back at where I was a year ago and compare that to where I am now. That gives me a more accurate picture and reminds me that I am making progress, even if it’s not as fast as I would like it to be,” she says.

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“I would just urge people to ask a couple of hard questions: What are you going to do if you do throw in the towel? Are you willing to forego calling your own shots for a steady paycheck with less freedom? Is what you are feeling the result of short-term fatigue? Can you just take a step back and get rested? It’s not for everyone, but as difficult as it is, quitting now is just not an option for me, and I can’t see a time when it ever will be.”

Saying goodbye to a business can be an emotional and conflicting journey. When I spoke to Wilson by phone recently, she told me that even though she’s 99 percent sure she made the right decision in closing her business, there is still that nagging feeling that maybe she can start it again.

This article was originally posted here on Entrepreneur.com.

Business Survival

How To Have Your Store Run Smoothly Without You (So You Can Take A Well-deserved Break)

Below are some tips that can help ensure the smooth running of your store even when you’re not around, and let you take that break without the stress.

Higor Torchia

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It can be hard for business owners to take time off from their retail stores – whether that’s because they’re too busy, need to be around to make decisions, or simply feel they can’t relax without knowing how the business is tracking. But taking a break can be incredibly important, if not sometimes necessary. And as we head into the busiest retail season of the year, taking a break now before the rush could be the best thing you do – for yourself and even for your business.

Below are some tips that can help ensure the smooth running of your store even when you’re not around, and let you take that break without the stress. 

1. Make the most of technology that lets you keep an eye on your store from anywhere

The beauty of living in this modern age is that there’s an abundance of tools that can help you run your store even when you’re away. To do this, cloud-based software is the way to go. Using a cloud-based solution to run your store means that you will no longer have everything housed on your computer server in one place. Instead, you can access files, sales and stock data, financials, business reports, customer and even employee data from anywhere, in real-time, and from any device provided you have an Internet connection.

The other beauty of cloud-technology is that it’s usually relatively inexpensive compared to more traditional systems. If you haven’t done so yet, look into some cloud-based software options, such as point-of-sale and inventory management, accounting and finance, customer management, and employee management and scheduling.

Related: 5 S-Words Make Your Store Site Pay For Itself

2. Develop a store manual

Create a manual that your staff can turn to when you’re not around. Document procedures, contact information, and anything else that will help your employees to know just what to do in your absence. Some of the sections you may want to include in the manual are: 

  • General store information – What do you stand for? Who are your target customers? Instil this information in your staff. The more they know (and love) your business, the easier it’ll be for them to make decisions in line with your company values. Include details on personnel conduct, pay and scheduling, store access, conditions of employment, store policies, etc.
  • Customer service – Have an entire section dedicated to taking care of customers. Include information on conduct, customer service standards, lost and found procedures, and dealing with difficult customers. Also, provide detailed instructions on how to handle theft and shoplifters.
  • Cashier procedures – Include information on the operation of your POS software, the types of payments you accept and how your loyalty program works.
  • Contact information – Take note of the tools you use in your store (computer, accounting software, analytics, cameras, etc.), and provide basic instructions on how to operate them. These tools likely come with their own manuals, so make sure that employees know where those documents are and how to contact the vendor if required. Include the contact details for the individuals or entities that your store deals with, including vendors, suppliers, business partners, contractors, etc. Also have a list of emergency contacts, such as the local police and fire department, as well as medical facilities in the area.

3. Appoint a second-in-command

Pick a second-in-command (or 2IC) to take charge of the store in your absence. This person should be someone you trust who knows the business.

It’s best to hire someone from the inside — ideally an individual who’s been in the business for a few years (this demonstrates loyalty) and has shown strong leadership skills or initiative.

Related: Why Launch A Member-Only E-commerce Store?

4. Empower your staff

Of course, the success of your store doesn’t depend on your 2IC alone, which is why it’s important to empower all your employees always do their best, even when you’re not around. This can be accomplished by giving them adequate training and by fostering an open environment that recognises the efforts of each team member. Encourage questions and be sure to give them specific as well as big picture answers so they know exactly how their actions affect the company.

It is important that you clearly define the roles of each staff member. Establish who’s in charge of what and require your employees to be accountable for their actions. Finally, believe in your employees and show them that you do. Trust you did your job right when you hired and trained them and that they’ll be fine even when you’re not there.

5. Do a test run

When should you start planning for your absence? That depends on the nature of your leave and how long you’ll be away. If you’re planning to be out of the office for a few days, then giving your staff a heads up a week or two before would be enough. But if you’re planning for maternity or paternity leave, then obviously your team needs to be notified months in advance.

Still worried? Implement a test run by consciously getting out of the staff’s way for a day or two. Work from home for a while or stay in your office instead of the sales floor and tell your 2IC to handle the store. Consider hiring secret shoppers who can put your staff’s skills to the test and have them report the findings, so you can figure out ways to improve. 

With Christmas and holiday season fast-approaching, now is a great time to start empowering your team so you can find the time for a well-deserved break.

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Business Survival

Stop Surviving And Start Thriving In Business

It will inform your operations, which will inform your human and asset capital and lastly, the financial investments you make.

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To thrive – and not just survive – in business you need three basic building blocks: 1) attract more customers and clients; 2) who spend more; and 3) buy more often. But how do we make this happen in the tight, recessionary environment we find ourselves in South Africa?

Despite the tough economic conditions, businesses can still thrive. In fact, many small businesses have been found to thrive in difficult economic conditions and are known as counter-cyclical businesses.

So how do you turn the tide from surviving, to thriving? You need to start thinking creatively, making informed decisions and being agile in the business environment. Always start with your marketing strategy. It will inform your operations, which will inform your human and asset capital and lastly, the financial investments you make.

Related: Business Basics: The Four M’s Of A Successful Start-Up

Ansoff Growth Matrix

Business leaders continuously explore various growth strategies to retain and grow market share. One of most respected and often used is the Ansoff Growth Matrix. It was first published in the Harvard Business Review in 1957, written by strategist Igor Ansoff to help management focus on the options for business growth. Ansoff suggested that an effective strategy considers four growth areas, varying in risk. This strategic planning tool guides us to understand our current situation, contemplate strategic options and consider the associated risks.

  1. Market Penetration: Market penetration has the least risk of the four options. Here you are selling more of the same things to the same market. You know your product and market well. The question is, how can you defend your market share and sell more to your existing customer? You may consider special promotions or introduce a loyalty scheme.
  1. Product/ Service Development: Product and service development is slightly riskier as you introduce a new component into your existing market. The advantage is that you sell to a customer/ client that you know, and they trust you. Ask yourself how to grow your product and service portfolio? You may consider adding new services and products or modifying your existing offering.
  1. Market Development: With market development you target new customers and clients with your existing products and services. You sell more of the same things to a different market. You can consider new sales channels, online or direct sales. Do a proper market dissection to target different groups of people, considering different age groups, gender and demographics.
  1. Diversification: Diversification is very risky. Here you consider introducing a new, unproven product or service into an entirely new market that you may not fully understand. You may need new expertise, acquiring another business or venturing into another sector. The main benefit of diversification is that during difficult times only one component or element of the business may suffer.

Related: My Business Is Growing… What Now?

The fifth element: Passion 

In addition, I would add one more element critical to business growth: Passion. It is the single component most critical to business success and, combined with any one or combination of the four areas of the Ansoff Growth Matric, it can equip small business owners with all they need to thrive in their business environment. Passion determines your business success, so make sure you have it in heaps to reap the rewards of your hard work.

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Business Survival

6 Common Decision-Making Blunders That Could Kill Your Business

Among the logical errors nearly everybody makes is thinking only everybody else makes logical errors.

John Rampton

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Humans are often very irrational. If you’ve ever explored behavioural economics or psychology, you may have found a host of examples demonstrating situations when we make objectively bad decisions.

Below are six of the largest decision-making blunders we all make. Avoiding them will dramatically improve your decision-making, your quality of life and success.

1. Sunk-cost fallacy

Of all the ones on this list, the sunk-cost fallacy is the most common. Many of the decisions we make are final or difficult to change. For example, let’s say you invest R1 000 in Facebook, and the price of the stock goes down to R600 the following day. The fact that you put in R1 000 initially is irrelevant to the situation at hand; you now have R600 worth of Facebook shares.

What this means is that once the decision is made and our cost is incurred, there’s no point thinking back. You already put in the time, money or other form of investment. Considering that in any future decision is illogical, despite how tempting it is. Instead, present yourself with the new options at hand — without considering the sunk cost.

Related: The 3 Dumbest Business Mistakes New Entrepreneurs Make Most Often

2. Narrow framing

Would you take this bet? You pay me R1 000 if a flipped coin lands on heads and I pay you R1 200 if it lands on tails. Most people would say no. We tend to be risk-averse, unwilling to risk something like R1 000, despite the reward being a bit greater.

Now, what if I offered you that bet, but I promised we would flip 100 coins? Each time, the loser pays up. Would you take it then?

Almost certainly, right? The chances that you lose money, overall, are extremely slim. This idea can be applied throughout life. When we’re in situations that will repeat themselves over time, we should take a step back and play a game of averages.

3. Confirmation bias

Another common one in the worlds of psychological and behavioural economy is confirmation bias. It hurts our ability to keep an open mind and shift our opinion. When we have a held belief, we typically look for information that confirms our opinion while ignoring data points that tell the opposite story.

For example, if I’m really excited about a new software product that I just integrated into my business, with ten of my employees as users, I might have made up my mind about the quality of the service before we put it to use. I would then be more likely to listen to the three employees who enjoy it, not the seven who don’t.

There’s almost always information that will validate our opinions, no matter how wrong they might be. That means we need to always look for conflicting evidence and, from there, make judgements based on more well-rounded information.

Related: 6 Rookie Investor Mistakes You Must Avoid For Profitable Investing

4. Emotionally driven decisions

When we’re angry or upset, we’re much worse decision-makers. When you have to make an important decision and happen to be in a bad mood, you should hold off. Instead, wait until you cool down and can think more clearly. It will remove the outside influences and let you think more rationally.

5. Ego depletion

This one makes intuitive sense, but it’s one of the most common ways to make bad decisions. The idea of ego depletion is that when we’re drained, physically or mentally, we’re less likely to think critically. Think about the times you’ve been exhausted after a long day of work. In those moments, you don’t want to have to think hard about anything. Instead, you want your brain to work automatically.

What that means is that when you’re tired and faced with challenging choices, you’ll rely more on your instinct or automatic processes as opposed to analysis and thought. That can be extremely problematic in situations that require effort.

6. Halo effect

The halo effect says that once we like somebody, we’re more likely to look for his or her positive characteristics and avoid the negative ones. This is similar to confirmation bias, but it’s oriented around people.

Related: 10 Stupid Mistakes Smart People Make

For example, let’s say I just hired someone named John, who was great during his interviews. Through his first few weeks, John does a few things well at work, but he also does many things poorly. The halo effect — brought on by his wonderful interview persona — could cause me to ignore his poor attributes and emphasise his good traits.

This can be detrimental to our ability to make judgements about others. We have to realise our biases toward certain people and eliminate them.

These are a handful of the many decision-making errors we’re all prone to. Although it’s challenging to scrutinise your preconceived notions, doing so is worthwhile. It gets easier over time and will, ultimately, make you a more effective decision-maker — personally and as a business owner.

This article was originally posted here on Entrepreneur.com.

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