The majority of businesses have shelf lives. Even a business that has been successful for many years may come to an end. Wrapping up a business is not necessarily a failure, but just a sign that it’s time to move on to your next venture.
What’s important is that owners take the appropriate steps when the business has run its course. How do you know when it’s time to call it a day?
When the numbers aren’t working
Businesses may ebb and flow at times. Prices may have to be adjusted and temporary discounts offered to help sales pick up again. Nonetheless, if the numbers stay flat, or continue to decline, despite all efforts, it could be time to think about an exit plan.
Very few businesses can sustain reduced prices over long periods of time.
When the competition is too high
When you initially started, you may have found a niche. Consumers had a problem and your company and services solved it for a fair price. However, there are few markets that remain untapped, and competitors may have caught on to the good thing you had going. A little competition is a good thing, but too much of it can saturate a market, perhaps meaning that it’s time for you to move on.
When the talent looks elsewhere
Talented individuals can typically see a few steps ahead. At one point in time, you were having to turn away talent because you had too many job applications. Now, your key team members are moving on to new pastures. A company that struggles to hold on to its best staff is usually a company that is struggling.
If you are considering closing your business, it’s important to take all of the appropriate legal steps. You’ll need to settle your debts, inform your workers, make customers and clients aware and honor all contracts. Having guidance behind you can help with this process and set you up nicely for your next business endeavor.