One of the hardest things to talk about is business failure. When your company is performing and you’re getting the results you want, it’s no problem to tell people about how you’re doing. But when things go sour, and you get trapped in that downward spiral it gets very hard to share that. For most business owners the failure of their business is a very hard slap in the face and some have a lot of trouble getting over it.
While talking about the failure might seem counterproductive and seems to portrait you as a wastrel, communicating about it with your most important stakeholders is very important and might even help you get through it and on your feet again.
Communicating with your family and close relatives
If you have a family, they should be the first one to know what’s going on. In fact, they should be informed from the moment you sense that things are going wrong. Discuss the situation with your spouse and talk about what steps you could be taking to prevent losing to much. If you have children, explain the situation. Exactly when it comes to a situation where you will have to cut on expenses, it will help if they know why that’s happening.
If you have close relatives you trust and of whom you know that they can provide you some assistance (financially or morally), talk to them.
Communicating with business partners
Creditors can be the greatest source of your worries. They delivered their services or products to you and are expecting to be paid. Because of the situation, it might be difficult for you to pay your outstanding bills. This can be a very embarrassing and stressing situation.
When this is the case, make sure to talk to your creditors as soon as possible. Ask for the possibility to pay in installments or to postpone payment. Offer clear solutions so your creditors know what to expect.
Don’t forget to inform all your business partners, explaining that you might be unavailable for business. You don’t want people to wait for products or services you cannot deliver.
Communicating with your customers
While you don’t have to provide all information to your customers, inform them that you will not be able to continue your services. If you have outstanding work, search for ways to delegate it to another provider, so your customer can still get what he was looking for. The last thing you want is an angry client filing a lawsuit against you for not delivering what you promised.
Being an entrepreneur means taking risks. Taking risks means sometimes you succeed, sometime you fail. And when you fail, absorb the experience and learn from it. Once you are able to take out the lessons you get out of your business failure, you might have the opportunity to work on your next business venture. One that will bring you the entrepreneurial success you are aiming for.