A heads up this feature is not going to be the most jolly feature I have ever written. In fact given I am celebrating 20 years of being in business it seems mad to now be writing a feature on failure but that’s the nature of the beast, with age comes experience.
So what is failure? Well if you are on the road to creating a business then it can be prudent to define success criteria, whether this is for your staff, or for yourself, it helps to create a line in the sand — a point where you can pat yourself on the back and say, “Hey, well done”
Now failing to reach that line isn’t failure, it’s just part of the process and you’ll evaluate why you didn’t succeed and move on to the next challenge. Failure, converse to success, should be a line somewhere back behind you- the low point, the place where it gets dark and you don’t want to really go. It’s a place where your business feels sick and perhaps you’re starting to wonder whether there’s a cure. These places can be due to bad debts, inability to pay your revenue bills, poor sales, escalating costs or plain old bad management — or more likely a combination of all of these. It’s the point where there’s no pat on the back, it’s the point where you should accept that maybe it’s game over.
I have had businesses that have failed, in some cases these businesses seemed successful but really they were just using up my time and really not creating anything tangible enough to warrant continuation. In other cases I really believed in massive growth and global domination but the cash reserves dried up and administration was the only option. Perhaps more annoyingly I have been confronted with situations where it really was failure but I plugged on thinking I could fix the situation. In the early days of Shred we were taken for £30K by a shifty ‘businessman’ that vanished off the face of the earth. It took us three years to fix the hole in our cashflow from this bad debt, caused huge amounts of stress. I plugged on and sorted it, delighted with my ability to fix the situation. However I wasted three years trying to fix an insolvent business. I’ll never get those years back.
When starting a business decide where you want to go, but also decide where you don’t want to go. If you don’t mind risk then don’t be afraid to run the gauntlet and aim high, don’t be irresponsible, but you’ll be surprised by the opportunities that open up if you set your sights a little wider. Similarly if you’re risk adverse and can’t sleep at night then keep your plans simple, control your growth and resist the bright lights, for with pleasure nearly always comes pain that you may not like.
If you haven’t already then get some business friends, people you trust to give you an honest answer to awkward questions. Don’t be afraid to spill the beans and lay it bare, if you’re not able to tell someone else your businesses woes then there’s a good chance that you’re not actually telling yourself those woes either. Those woes will eat you up, set them free.
Finally, if failure is at your door then seek good advice. An insolvency specialist may be the only option but it’s a good option. Always know that if it doesn’t work out then you can get out. You’ll live to fight another day.