4 Signs Your Small Business Might Not Make It

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Is your small business doomed to fail? Read on to find out. 

Starting a small business means taking on a fair amount of risk. After all, there’s no guarantee your business will end up thriving long-term.

About 80% of small businesses survive after a year, according to the Small Business Administration. But at the five-year mark or longer, that percentage dwindles down to about 50%. And only around 33% of small businesses survive 10 years or longer.

It’s important to recognize the signs that your business is on a downward spiral. And if these apply to you, it means your business may not make it in the long run if you don’t start implementing key changes.

1. You’re burning through cash at a rapid pace

All small businesses have expenses. But if you’re burning through cash at a rapid clip and aren’t replenishing it quickly enough, then your business may be destined to fail.

Take a look at your business’s banking records, then try to take steps to reduce your spending. If you’re not sure how to do that, you may need to bring in a small business consultant to help advise you.

2. You’re not growing your customer base

It’s a nice thing for your business to have a steady stream of customers, but that’s not enough. If you want your venture to thrive, you need to work on growing your customer base so it doesn’t remain stagnant.

Think about different ways you can attract customers to your business. That could mean expanding your services or product line or being more savvy with promotions and referral programs.

3. You have a lot of employee turnover

To have a successful business, you need a team of dedicated people to keep it running. But if you can’t seem to retain talent and you’re constantly dealing with worker turnover, it’s a sign your business might struggle to the point of failure.

Think about some of the reasons why your workers may be quitting on you. Are you not paying a high enough wage? Are your demands too extreme? Do your workplace benefits leave much to be desired?

If you’re not sure why your business is experiencing so much turnover, survey your current employees and ask how they feel about their respective roles and the general working environment. You may be able to gain some insight that helps you make positive changes.

4. You’re employing temporary fixes to big problems

Your business might have major issues you keep finding temporary solutions for. That’s probably not going to work on a long-term basis.

Let’s say you have outdated technology, so you keep fixing old equipment rather than investing in new equipment. That approach might only work for so long. Think about the ways you can find longer-term solutions for the issues your company is facing.

The last thing you want is to see your small business shutter. In some cases, that fate may be unavoidable. But if these issues apply to you, there are steps you can take to address them — and save your business from failure.

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