Most businesspeople see the closure of a business as a negative outcome and assume it’s something they could never get over. Yes, it’s quite a loss, and there are chances you could end up in debt, but shutting down your business is not the end of the world.
As many successful entrepreneurs can tell you, it’s these losses that create the foundation for future gains. It’s more beneficial to look on the positive side when you examine the closure of a business. During the process of shutting a business down, the language you use needs to be more positive so that it helps create a better future.
Shutting down your business: Learn and then start again
Viewing the business as an experience or journey rather than a destination or end goal is especially helpful. This mindset will help you and your team see a business closure as a growth or development process and not a failure. In fact, most successful entrepreneurs can regale you with lessons from their past, of businesses that just didn’t make it yet provided the springboard or motivation for the success that followed.
Restructure and move on
Rather than simply looking to close or shut down the entire business, it’s sometimes possible to restructure or reform a different enterprise. The best analogy is that of a phoenix rising from the ashes, and great business people are often able to do this seamlessly. Moving from the end of one business and into the start of a new one can be exciting because the new venture will likely benefit from what you may have learned along the way.
Look at all the options available
It is incredibly critical to be able to do a full options analysis. You can get some great advice online from consultants and other practitioners like McAlister and Co, which can help you focus on positive options like restructuring rather than just shut down. Pay attention to the language used by the team you choose to work with and only select people with similar optimism and mindset.
Conduct a postmortem
If there’s just no way out of closing the business, then one of the best things to do is conduct a concise and accurate analysis of why you had to do it. Either have an insolvency practitioner advise and facilitate this process or perform it as the final exit interview process. The knowledge gained and then hopefully shared with others will provide for a wealth of learning.
Failure is a part of life
The fact of the matter is that most new businesses close or fail in their first year. The individual reasons can be varied and numerous, but the bottom line is that for any business, failure is always a risk, even in the best of times.
Perhaps the best advice you can take from this way of thinking and the actions suggested above is clearly stated by the founder of Honda, Soichiro Honda, who said, “Success represents the 1% of your work that results from the 99% that is called failure,” So, be more mindful of a so-called business failure and recognize it for what it can be, a positive.
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