How to Know When to Quit Your Business

How to Know When to Quit Your Business

How to Know When to Quit Your Business

Opinions expressed by Entrepreneur contributors are their own.

I went through several tough years in my business. During that time, problems came one after another. Just when I felt like I had things under control and things were turning around, another challenge arose. In my coaching with entrepreneurs, this is a common experience. Being in business is challenging. There are hard times, and sometimes these go on for a long time. How do you know when it is time to quit? How do you know when to persist?

Nine out of ten entrepreneurs are burning out, based on the research we’ve been conducting using the Better Business, Better Life Assessment over the last four years. Burnout is insidious. It comes on slowly as we tell ourselves, “I can muddle through.” When we muddle through for an extended period, our capacity for resilience diminishes, and symptoms of burnout increase. One of the more severe symptoms of burnout is a loss of hope for a promising future. It’s often at this point that we want to throw in the towel.

Related: How to Spot Entrepreneurial Burnout (Before It’s Too Late)

When you feel that way, assessing what is truly going on with the business is vital. Avoid making any rash decisions when you are in the middle of a crisis. Give yourself thirty days to assess the situation and explore your options.

The Better Business, Better Life Assessment is a crucial tool in your journey to combat burnout and help you assess your business’s health. It’s the only assessment designed by a business psychologist that evaluates entrepreneurial burnout about the health of your business systems. Our findings show that burnout symptoms escalate in businesses with system gaps. Entrepreneurs who are not burning out have nearly double the number of systems in place compared to those who experience burnout. By taking this assessment, you’ll receive valuable feedback on the systems that need improvement in your business, leading to a higher quality of life.

In my coaching with entrepreneurs, I notice that allowing vulnerabilities to exist in our business for too long can be easy. We are aware of problems, but we avoid addressing them. Allowing multiple vulnerabilities to exist in the business for an extended period makes us particularly vulnerable to problems stacking up quickly in a short period. For example, keeping a toxic team member because your busy season is coming up could lead to that person quitting when you need them the most.

Cash flow is a struggle that, when it persists for an extended period, can make us vulnerable to burnout as we make survival-trap decisions that can worsen our situation. Multiple issues could be at play when cash flow is a struggle. Dig deeper instead of assuming that increasing sales is the solution to your cash flow challenge.

Related: 7 Tips To Avoiding Burnout As an Entrepreneur

If your revenue has been increasing, and cash flow is a challenge, it’s likely that expenses are outpacing revenue. This happens frequently in growing businesses, particularly as you add team members to meet increased demand. In this situation, you will want to look at ways to improve business efficiency and reduce payroll costs. What expenses can be cut? What activities are team members doing that can be automated? Do you have underperforming team members? If so, let them go.

If sales stagnate or slow down, you are likely not serving your sweet spot. Your offering may not appeal to your top clients. Identifying your top clients and interviewing them to better understand their needs will help you align your offering to better serve their needs and give you insight into how to adjust your marketing messaging to attract more business from clients like your top clients.

Often, the people challenges can make us want to throw in the towel. Dealing with difficult or demanding customers takes a toll on us and our team. Dealing with underperforming team members who are not coachable can make us question our leadership skills. Adding a system to help you consistently attract A-players to your team will help you reduce drama on your team. Similarly, putting a system in place to attract top-quality clients while creating filters to screen out poor-fit clients will reduce the PITA (“Pain in the Assets”) clients.

Related: Small Business Burnout: How to Learn the Signs and Avoid It

Seek out support. When I went through hard times, I worked with my coach. The objective perspective was invaluable — we all have blind spots. I also confided in other business owners and derived great support from the awareness that I was not the only one having this experience and hearing about their experiences. Often, I could formulate a more effective plan after receiving input from my coach and peers in similar situations.

I intentionally identified early signs of success to let me know my plan was working. I also focused on wins and successes each week, which helped me keep moving forward, even when there were setbacks. Due to the challenges we experienced, we strengthened several systems. Because of that, our cash flow is stronger than ever.

Deciding to let the business go is a viable option, particularly for entrepreneurs who have been experiencing severe burnout for an extended period of time. In this situation, it can be helpful to work with a coach to determine the best way to transition the business, what can be strengthened in the business over six to twelve months to increase its value, and what is not worth the effort.

Entrepreneurship demands a lot of us. Prioritizing our self-care and seeking support will help us make the best decisions during tough times.

Source link