Failure is a part of life. Even in the world of business, this fact holds. The unfortunate truth is that nine businesses out of ten fail in their first year. More notably, not all of those who failed were poor management, ideas, or follow-through.
Sometimes a good business will fail. What is essential is how entrepreneurs learn from their failures and any mistakes made along the way. Since this is a task easier said than done, here is some advice on handling failure.
Be Prepared
As mentioned earlier, the odds of starting a successful new business aren’t fantastic. While that shouldn’t stop you from, it does mean that you should mentally prepare yourself for what may follow.
Even if the business doesn’t fail then, the odds are good that failure will come along the way. It can be on a small or large scale, but it will still happen. Lean into that knowledge, but don’t let the fear of it control you.
Stay Practical
When dealing with a failure or loss, it’s easy to cave into the temptation to make decisions on an emotional basis. However, that is one of the worst things an entrepreneur could do at this moment.
I’m essential to give yourself time to breathe – to collect yourself and get back to a point where rational decision-making can be found once again. Entrepreneurs rely on their ability to plan and access – don’t take this quality away in a moment of frustration.
Analyze What Happened
It’s crucial whenever a failure arises or a mistake happens to take a step back and analyze the situation. One needs to find out what happened to prevent it from happening again. That is how we learn from our mistakes.
Sometimes that means you’re going over a single project with a fine-tooth comb. Other times, it means you must reevaluate your entire business plan. The scale can alter drastically, but the response shouldn’t change.
Small Businesses recommend that entrepreneurs run a SWOT analysis, not just following a failure, but regularly. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats.
Strengths – know what is working in your business. Weaknesses – be aware of what isn’t working, what needs to be changed, and what is likely to fail—opportunities – external factors that can benefit your business. Next are threats – negative external factors that can pose a threat to the industry, including competition, environment, and more.
Start Again
The most critical lesson revolving around failure for entrepreneurs is that it doesn’t stop you. After disaster strikes, an entrepreneur should be ready and willing to get back up and start again.