Like it or not, your business is a ticking time bomb. Eventually, something will go wrong or it will fail.
The trick here is to constantly adapt. If you can stay up to date with the latest trends and movements, you’ll thrive. If you don’t put strategies in place, though, you won’t make it.
You can see this is true through the statistics of the sheer number of businesses that fail every year. The numbers are mind-boggling. Most people don’t make it.
Fortunately, this post can help. We look at some of the reasons your business is a ticking time bomb and how you can improve your situation to avoid disaster.
Lack Of Innovation
Lack of innovation is one of the biggest reasons companies go out of business. Failing to adjust their approach puts them at risk of being eaten alive by rivals.
Just look at what happened to the phone company, Nokia. The firm believed that the concept of a “smartphone” was still years away in 2007. Then, Apple dropped its bombshell iPhone, perhaps the product of the century, and the company essentially lost the market and went out of business.
The trick here is to stay on your toes. Don’t assume that you have to operate in any specific way. Look at what the current state-of-the-art allows and adapt to it, changing your business model if necessary, to work around it.
Lack Of Strategy
Another massive reason for companies going out of business is a lack of strategy. Failing to think through how you’re going to win in the marketplace makes your firm less competitive and prevents you from developing a clear vision for where you want your company to go.
To get out of the habit of drifting aimlessly, take time to build a clear vision for your firm. Write it down on a piece of paper and stick it up on your office wall if that helps you.
Some entrepreneurs put their business plans on the back of refrigerator doors. This reminds them of what they are shooting for every time they go to grab a snack.
Lack Of Survival Plan
Another big no-no is failing to develop a survival or contingency plan if things go wrong. Business-critical systems can go out of service at any time, leaving you up the creek without a paddle.
For example, you might suffer a massive IT outage that prevents workers from accessing key files. You might also see your phone network go down, preventing you from taking customer calls or making sales.
The trick here is to put solutions in place that let you remedy the most serious and likely outages. For example, find an Office 365 backup that fits your needs. Storing all your files elsewhere will help you retrieve them if someone hacks your network.
Also, ensure you have plenty of redundant machines and even a separate location from which to work if things get really bad. Don’t rely on a single building or office unless you have to.
You can also increase your firm’s capacity to enable people to work from home. Putting these systems in place makes it more straightforward to operate online.
Your business might also get into trouble if it can’t differentiate itself from the competition. If you’re offering the same suite of services as the next guy, there’s no reason for someone to pick you over them, except for the price.
That’s where differentiation can help. If you can prove that you do something different from your competitors, customers will be willing to pay more for your services.
Just look at what the most successful companies do. These firms invest in R&D and training to elevate themselves above the competition. Big brands find ways to make themselves more appealing than the average company, enabling them to increase their prices.
Finally, your business might be a ticking time bomb if you have excessive debt. Beware of becoming a “zombie company” that requires a constant influx of venture capital to remain buoyant. These firms could go out of business the moment interest rates rise.
Carrying around too much debt is a problem because it increases the cost of doing business. Money that could go into lowering prices or improving products must instead be diverted towards repayments, which is a colossal challenge for any company just looking to get started.
You can deal with debt by looking for efficiency savings today. The fewer inputs you can use to generate outputs, the better.