External Factors
This includes events that just aren’t your fault. The pandemic interrupted almost every business in this country and caused numerous to shut down. Other risks include shifts in the economy such as the Great Recession of 2008, political upheavals, natural disasters and significant regulatory overhaul. So what can you do about this? You have to have backup plans in place and be agile enough to adapt.
Many companies had to completely remap their strategy during the pandemic. Some switched to online-only or instituted strict safety measures. Think about the worst case scenarios and make a plan for dealing with them.
Burnout Leading to Apathy
This is one of the leading causes of why businesses start to go wrong: business owners try to do too much. They believe they are the only ones capable of handling all the operations of the company and fail to delegate. This usually leads to burnout which can lead to apathy for the business. You began your business because you have a passion for it. Don’t lose that passion and resent your business. Instead, delegate your tasks to your team. Hire employees for the jobs you like the least and don’t forget to rest.
Cashflow Crunch
Lack of funds is the primary culprit for small business closures. Money is tight or maybe even nonexistent. There’s far more money loss than gain and as a result, you scramble to figure out how to make it from one day to the next. So what can you do?
For one, you need to make sure you get paid. Small business owners aren’t always as diligent as they should be when collecting invoices. This hurts your business. Have a system in place to facilitate payment collection. Also, revisit your budget. Look at ways you can cut costs and see where wasteful spending can be eliminated.
Inefficient Customer Service
Customers are the heart of your business. Without them, your business dies. If your customer service is bad and you’re not trying to improve it, your business can fail. Customers report their experiences online and word of mouth. If you have too many bad reviews, your company will take a nosedive. You need to make sure your employees know how to interact with customers and offer training in this area if needed. Be sure to answer all questions and concerns from customers. If someone leaves a negative comment somewhere, be sure to respond to it.
Don’t leave a nasty comment back. Instead, reply meaningfully and respectfully. Try to figure out how you can address the situation and you can even take the extra step to make it up to the customer by offering a discount or refund. This will definitely improve your business’s reputation.
Cyber Security Breaches.
Many small business owners don’t really think about cyber security and the steps they need to take to protect their business. The fastest way for a small business to crash and burn is to suffer a significant cyber breach. If customer information is compromised and those customers suffer, you could be in for a massive crisis. You need to have a plan in place to protect sensitive customer information. You also need to look into insurance regarding cyber breaches. Conducting regular security audits, updating passwords, and watching out for employee misuse are critical steps to preventing cyber security breaches that could be catastrophic for your business.
Gets The Funds You Need to Protect Your Business
First Union Lending offers numerous financing programs designed with small businesses in mind. Our business loans are fast and flexible, with financing options ranging from $5,000 to 2 million dollars. Call today to learn more about our various financing solutions to help your business grow and become successful.