What to do if your business is going under

Businesses fail. Sometimes, you can catch a business before it reaches that point and right the ship. In other cases, you'll be stuck as your business slowly begins to sink. If your business is already underwater, your initial reaction may be to panic. If you want to do something useful, though, you should follow the advice below. 

Identify Your Problems

There are many reasons why a business may fail. Unfortunately, most entrepreneurs panic and assume that more - or fewer - problems apply to their own business than are really at fault. Before you start panicking, start trying to identify your real problems. What's causing your drop in income? What's keeping customers away? Figuring out the underlying cause of your problems is a good ways to start making long-term plans. Remember, the truth may not always be easy - but it will be better than operating in the dark. 

Put Aside Your Ego

Your next step is to put aside your ego. If your business is failing, it may be because you need help. Is there anyone to whom you can turn for advice or financial help? Is it time to bring in an expert to help prop up your failing but ultimately valuable business? If so, you need to swallow your ego and make the call now. The longer you wait, the more options that will be closed to you. With a few phone calls, you might be able to solve your problems - but only if you are willing to put your business before your pride. 

Kill Your Darlings

William Faulkner said that to write successfully, you must kill your darlings. This advice holds just as true in the business world. If your business is at a point of failure, it may be time to put some of the things you love to pasture in order to streamline your business. You might, for example, love that your business isn't open on Sundays - but if that's what is needed to support your business, it's time for you to make the change. Ultimately, your goal should be to provide what your customers or clients want - they're the ones who pay your bills 

Know When You've Failed

One major problem among entrepreneurs is an unwarranted sense of hope in failing businesses. If you care about your long-term success, it may be time to figure out if the warning signs of real failure are there. This isn't only a bleak process, though - there's a difference between a business that can be turned around and one that can't. Once you know where your business lies on that spectrum, you'll be able to make better choices about your own future. Sometimes, a doze of realism is a necessity. 

Consider Bankruptcy

If your finances are underwater, it may be time to consider a Chapter 13 Bankruptcy. While many business owners bristle at the thought of declaring bankruptcy, it may be the best chance for your to reorganize your debts and hang on to your business. Remember, bankruptcy doesn't mean that you lose everything - but it can help you to clean up the financial messes you've already made. You'll have to tighten your belt if you choose this options, but your finances may become less of a burden.

Figure Out Your Exit

Finally, you may need to figure out how best to extricate yourself from your current business. When you learn that your business is unable to be salvaged, you'll need to start thinking about your own future. This may mean selling off your business or its assets, or possibly winding down the business itself. It may not be particularly easy to do on an emotional level, but securing an exit strategy will be the best way to give yourself a chance to succeed again. 

You may or may not be able to save your business. You will, however, be able to make a better plan for your future. A failing business doesn't have to be the end of the road - at least, as long as you are committed to making sure that it doesn't drag you down with it.