It’s a situation that no business owner ever wants to find themselves in: Closing a failed business. This failure takes an emotional toll, and all of the effort that you put into your business may seem to have been for nothing.
But that’s not actually true. You’ll have learned important lessons in running that first business, and you can use those lessons to ensure your next business has a better chance of succeeding. While you may be feeling devastated from the initial failure, you can recuperate from that loss and use it to find your next opportunity.
A failed business doesn’t make you a failure — in fact, it puts you in good company. New businesses fail, and they fail often. The Small Business Administration has reported that 30% of businesses close during their first 2 years in operation. Half of new businesses close during their first 5 years, and 66% close during their first 10 years in operation. Only 25% of businesses last for 15 or more years.
Clearly, starting a new business is hard, and it’s a challenge that even the best entrepreneur can fail at. Just because your business fails doesn’t mean that you can’t go on to start another successful business. In fact, you can use the experience of having run a business to your advantage. You’ve seen what can go wrong, so now you can take steps to make sure those things go right the next time.
Think back to the major problems you faced with your failed business. Were you unsure of how to best use your marketing budget? Did you have trouble finding great employees? Or did you struggle keeping up with the accounting demands of your business? Additional training can help better prepare you for your next business venture.
Consider investing in training that will give you the small business accounting skills you need. Maybe this means going back to school or taking online courses. Your local Small Business Administration may also offer training in valuable skills for business owners, like human resources, hiring, and management techniques.
You may already be aware of some resources available to small business owners, but before you start your next business, take a step back and thoroughly research all of the opportunities available to you. Green loans and energy efficient tax credits can help you save money on business expenses, and they can be a natural fit for a business that prioritizes sustainability.
Make sure you also research smart ways your company can save money. Reducing office space to save on rent, renting company vehicles instead of buying them, and buying supplies wholesale or in bulk can all help to stretch your budget and save you money. By embracing these strategies, you’ll increase the chances of your next business becoming profitable — and successful.
As you do your research, take the time to write a detailed business plan. Include market research to make sure that your new business idea is viable and that market demand will support it. Having a business plan is just one important step to starting a business, and it’s a must-have if you’ll be applying for loans or trying to secure investors.
You may find that your failed business is affecting how you approach and think about your new business. It’s easy to fall into the trap of not really investing yourself in your new business, or even viewing its potential success from a place of negativity. You’ll need to prevent that from happening if your new venture is going to succeed.
Start by getting yourself excited about this new opportunity. Focusing on revitalizing ideas for your business can help to get you invested in the journey, and that excitement will carry through to your employees. Remember that your employees are also integral to your company’s success, so focus on building a great team. Team-building strategies like taking the team on outings to events, offering company gifts, and even taking part in games and activities right in the office can all foster a cohesive team environment. By building a great team, you can boost morale, increase employee productivity, and foster creativity, all of which can contribute to your company’s success.
The experience that you’ve been through with your failed business can create some anxiety when it comes to starting your new business. You may find yourself procrastinating and doing lots of research and planning without taking any action. At some point, you’ll need to stop procrastinating and start your new business. Start by writing a to-do list, then make sure that you complete at least one task every day.
Starting a new business is a stressful but exciting time, and it’s important to remember that your past failed business doesn’t mean that every effort you make will fail, too. Instead, use that failure to your advantage and learn to correct what went wrong the first time. Who knows — this new venture might just turn into that successful opportunity you’ve dreamed of.