Amid fears that some 200,000 businesses could go under during this recession, there is a ray of hope: Barclays Local Business’ survey of SME bosses has found that 40 per cent of entrepreneurs would not be put off by the experience, founding another business immediately. And a staggering 85 per cent of those surveyed said that they thought failure was a good thing, providing them with the experience to succeed later.
While RB is confident that none of our readers will suffer this fate, we thought we’d provide a contingency plan just in case. So, here’s a list of top tips from Barclays to help entrepreneurs bounce back from a business failure.
1. What went wrong? Assess your mistakes from your last business and ask what could you have done better. Try not to get emotional, and realise you can learn from your experience.
2. Know your market. If you’re entering a sector that’s new to you, then find a source of information you trust, and use that knowledge to plan your strategy.
3. Use your contacts. Just because your previous business has gone, doesn’t mean you can’t use all those people you’ve worked with. They’re a head-start, so make sure you keep an eye on your address book.
4. Start small. Even the mightiest of companies began small. Your business might conquer the world one day, but start with a manageable enterprise and don’t stretch yourself or your cash too soon.
5. Get online. A web presence is vital these days both as a way of advertising your business to the outside world, but also as a channel to market.
6. Find people you trust. Running a small business often means relying on friends or family, either to work through a busy month or cover everyday business. Surrounding yourself with a team of people you know and trust can remove major staffing problems, bring stability and reduce the amount of time spent searching and training employees.
7. Get insured. Buy a policy that gives you cover for sickness and accidents – that way, if your body crashes, your business won’t.
8. Get the right financial help. Shop around for a bank to give you support, and look out for offers for small businesses – especially interest-free transactions, which can eat up early budgets. Take advice on what investments will suit your firm.
9. Don’t rush. It’s easy to get carried away with a new project – but remember, with experience under your belt, you’ll gain a lot from taking your time and reflecting on how you’re doing.
10. Talk to an expert. Find someone who can give you firm and fair advice. It may come from a host of different sources and organisations. Review your business plan in detail, and explore ways to make sure that this time, your business will soar.
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