There are many more small businesses in the United States than large businesses, so it’s easy to understand why they are vital to the U.S. economy. Considering that even multi-million dollar corporations have had to file for bankruptcy protection or close their doors completely in recent years, many people mistakenly assume that small businesses are struggling in today’s economy.
Small businesses can be successful
Small businesses run the gamut from local law firms with 100 attorneys to Mom and Pop corner stores with 50 employees and even one-man operations that are run out of the owner’s home office. Although it’s inevitable that not every small business will ultimately be a success, many are flourishing. A recent study by Chicago-based SurePayroll surveyed 300 small businesses, and an impressive 30% of respondents had actually seen a sales increase over the past year.
However, if you are a small business owner who is experiencing tough times rather than watching your sales forecasts soar through the roof, it may be tempting to throw in the towel. A few of the top reasons that many small businesses fail include:
- Lack of experience
- Insufficient capital (lack of funds)
- Poor location
- Poor inventory management
- Poor credit arrangement management
Bankruptcy can be avoided
Whether your business has significant debt because it is just getting off the ground or you are keeping creditors at bay by juggling debt from one credit card or line of credit to another, therefore treading water while trying to stay afloat, it is possible to grow your small business and avoid bankruptcy.
Planning and preparing for the future, which will predictably include some bumps along the way, is one of the best ways to help your business grow economically. The Small Business Administration recommends the following:
1. Forecast for growth in the future even as you focus on the present. Strategic thinking and planning can help you achieve your ideal outcome.
2. Use technology to stay competitive. It’s vital for small business owners to understand current technologies and take advantage of them! Accounting software, planning software such as an online calendar, time tracking software to help determine which tasks are profitable, email management programs to keep things streamlined between multiple email accounts and mobile devices that can make life easier when you’re on the go are just a few suggestions.
3. Develop a marketing plan that will help you make a profit. A solid marketing plan should include everything from understanding your target audience and how you plan to reach it to how you will separate yourself from the competition and make more sales.
4. Consider franchising your business if you are interested in expanding without spending most of the money yourself. Realistically speaking, few small businesses can be franchised, but it is possible if you offer superior products or services that are in high demand and your business model is easy to duplicate. Setting up the legal end of things will involve significant costs, but you could expand your business and earn franchise fees.
These are just a few suggestions to help your small business grow and avoid significant debt. If you honestly feel that bankruptcy may be your best option, it would be wise to meet with a legal professional for feedback and advice.
Jon Reiter is a marketing agent for http://www.jonbclarke.com/, experienced Denver bankruptcy lawyers.
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