Although running a business can be thrilling, it’s not without its challenges.

Sadly, about 20% of companies fail in their first year, and a staggering 70% disappear within a decade. Financial struggles are often the culprit, with bankruptcy being the ultimate fate for tens of thousands of businesses worldwide every year.

Other factors like market disinterest and internal disagreements can also contribute to a company’s downfall. In this interview, Gabriel Bristol discusses his experiences leading turnarounds for various companies and shares insights on what it takes to bring a struggling business back to success. With a background in sales and marketing as well as executive leadership positions, Bristol offers a unique perspective on overcoming challenges and making difficult decisions to change the course of a company.

Whether it’s addressing flaws in strategy, management incompetence, or small issues that add up to slow down the enterprise, Bristol emphasizes the importance of taking a fresh approach to tackle these obstacles head-on. His experiences provide valuable lessons for business leaders looking to turn their organizations around and set them on a path to success.

Some ways of saving your sinking business are:

  1. Turn a Keen Eye to your Cash Flows:

The CEO of Dubai SME, Abdul Baset Al Janahi, highlighted that financial support is one of the most significant challenges faced by small and mid-sized businesses.

This is further corroborated by research indicating that 82% of business failures are attributed to cash flow problems.

To overcome this obstacle and ensure the longevity of your company, it is essential to manage your finances effectively and prioritize protecting your revenue. By developing a solid financial strategy, you can not only save your business from potential bankruptcy but also pave the way for sustainable growth in the future.

Do this and you’re creating a blueprint that will not only save your business but will see it grow in future.

Here’s What You Can Do About It

To manage your cash flow effectively, consider seeking expert accounting help and trimming down your expenses to the bare minimum required to operate. You can start by cutting non-essential costs that don’t contribute to ROI, such as subscriptions and memberships, and reducing costs for essential outgoings, such as opting for cheaper technology or hiring remote freelancers. It’s crucial to identify areas where you can save on overheads without compromising on quality. By creating a budget and sticking to it, you can protect your finances and ensure your business stays afloat.

2. Sell off the Assets You Cannot Afford to Lose:

To avoid getting overwhelmed by financial troubles, it’s important to prioritize cash flow over assets. Although owning an office building or technology might seem like a sign of stability, it’s the money that keeps the business running.

Selling assets that are not essential for operations can provide much-needed cash, instead of relying on the false sense of security that comes with being asset-rich. Remember that cash is king, and it’s essential to keep it flowing in to keep the business afloat.

Here’s What You Can Do        

Evaluate all your business and personal assets to determine if you can sell some to free up cash. It is not wise to depend solely on asset ownership, as it may lead to financial instability. Instead, consider selling some assets, such as office furniture and equipment, to buy cheaper options or lease them.

You could also look into your personal assets and sell any items that aren’t essential to the business to generate some cash. This strategy can help turn things around for your company.

  1. Consolidate Your Business Payments into One Loan

Managing debt can be daunting for startups when it is spread across various sources. It can be stressful to deal with multiple requests for payment, potential penalties, and confusion about which creditor to pay first. However, there are methods to address this issue and improve your financial situation, enabling you to save your business and achieve growth.

Here’s What You Can Do About It

Prioritize the payments that are vital to keeping your business running, such as utilities and other necessities. By triaging your payments, you can ensure that the most important expenses are taken care of first. Another option is to consolidate all of your debts into one loan, which will make it easier to manage and reduce the number of payments you need to make.

  1. Renegotiate Contracts with Vendors and Suppliers:

Businesses are expected to abide by the terms and conditions agreed upon when signing a contract for a product or service. However, it’s common for companies to overlook the potential for changes in circumstances and the impact they may have on their ability to fulfill their obligations. This can result in strained relationships and immense pressure, especially if the business is unable to meet their commitments, leading to financial troubles and the possibility of bankruptcy.

To avoid such situations, it’s important to establish agreements that are mutually beneficial and can accommodate future changes. It’s also wise to revisit and renegotiate contracts if necessary, to ensure the agreement remains feasible and practical for all parties involved.

Having a deal that all parties are happy with is essential to your success, so it’s always worth seeing if you can change a pre-agreed deal if it’s no longer working for you.

Here’s What You Can Do About It

Contracts are an essential part of any business relationship, but they are not set in stone. If your circumstances change and you are struggling to meet the agreed terms, it’s worth reaching out to your suppliers to discuss the possibility of renegotiating. This is especially true for long-term contracts or those with larger, more complex terms.

Even if you have to pay for legal advice, it could be worth it if it helps you get a revised deal that takes the pressure off your business. Consider limiting contracts to shorter terms, such as one year, so you have the opportunity to reassess and renegotiate regularly. Additionally, look at smaller contracts with service providers and see if you can find a more cost-effective option or switch to a different supplier altogether.

  1. Revise your Budget and Business Plans:

According to recent studies conducted in the UK, a significant number of small and medium-sized enterprises (SMEs) are entering the business world without adequate preparation.

Approximately 26% of these businesses have no business plan, while 9% of startups have no predetermined budget. Even those who do have a plan or budget in place may have only given it a cursory glance, as revealed by another survey which found that 1 in 10 SME leaders were not sure how to develop a proper business plan.

Having a clear plan and budget is essential for building a successful business. These serve as the foundation that outlines the company’s goals and the strategies to achieve them. Neglecting or creating a poor plan and budget can lead to confusion and mounting debt, while a well-thought-out plan and budget can pave the way for business success.

Here’s What You Can Do About It

It’s essential to regularly review your business plan and assess whether it needs improvement. Determine whether you have correctly identified your target market and if your pricing structure still makes sense.

If you discover any issues, fix them immediately and continue to revisit and revise the plan to ensure it remains effective. Additionally, it’s crucial to adjust your budget regularly, as this will enable you to monitor and manage your expenses. Doing so will prevent you from accumulating more debt and allow you to pay off any outstanding balances as your business continues to grow.

Final Walkthroughs- It’s Never Too Late to Save your Business

It’s common for businesses to face financial struggles and debt, be it during the crucial initial years or due to unforeseen market shifts and competition. However, it’s crucial to stay composed and remember that there are solutions available to help your business recover from the brink of collapse. Options such as selling assets, budget adjustments, and loan consolidation can all help to regain control over cash flow and turn the business into a success. By adopting smart strategies and keeping a cool head, your business can overcome debt and thrive.

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