By Contributing Author
If you find your business struggling, it might be helpful for you to understand it’s not necessarily something that’s within your control. Sooner or later, every business venture is going to encounter its struggles. As a business owner, you need to be more concerned about how you are going to react to said difficulties as opposed to worrying about who or what’s to blame.
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Likely, a big part of the consternation you feel as your business struggles comes from the financial difficulties it creates in your personal life. Keeping in mind that time might be all that’s required for you to survive your business downturn, it’s quite possible all you need to figure out is how you can financially ride out the storm. It might be nothing more than a few weeks or months.
In the discussion below, we want to address steps you can take to make sure your personal finances don’t suffer unduly because your business is struggling. Remember, these are temporary financial options you can take to keep you going until things turnaround.
Downsize the Company
There’s little doubt you can improve your personal financial situation if you make cost-saving decisions for the company. While it can be a little painful, you could always start by downsizing your staff. In all likelihood, your business struggles are creating downtime for some of your employees. If so, it makes sense to combine responsibilities and see if your business can survive with fewer salaries to pay.
Downsize Your Lifestyle
It’s human nature to acquire a lifestyle that’s commensurate with the income a person is able to create from their business. If your business suddenly stops bringing in the same level of revenue/income, it’s quite possible you would need to reassess your lifestyle. If there are areas in which you can lower your living costs, it might buy you the time you need to let your business work through its struggles.
The conversation about downsizing one’s lifestyle could cover a lot of areas. You might want to start by eliminating frivolous personal expenses such as country club memberships, eating dinner out at expensive restaurants and purchasing personal toys like ATVs. If you need more financial room, you might consider downsizing your living quarters or cutting back on auto expenses.
Remember, it’s important to find cost savings, but it’s not absolutely necessary for you to eliminate all joy and pleasure from your life. Your business struggles don’t necessarily have to translate to personal struggles.
Selloff Company Assets
If you truly believe the business downturn is temporary and correctable, you might want to create a war chest of cash to help you survive. You can certainly consider selling off any company assets that might be lying dormant due to business inactivity. That would include selling off any assets that are encumbered by debt. When the business gets back on its feet, you always have the ability to reacquire the assets you need to operate the business.
Tap into Personal Savings
If your focus in on maintaining some quality of life, you might want to consider using your personal savings to help tide you over until the business reignites. If you choose this option, you’ll want to make sure you use what’s available as efficiently as possible.
Most people save money for either emergencies or retirement. If your business is struggling, that would certainly qualify as an emergency. If you are reluctant to tap into your savings, consider this: you’ll likely have plenty of time to reestablish your personal savings once the business gets back on its feet. At that time, you’ll have an opportunity to better plan for the next time your business struggles.
Get Help During an Emergency
An unexpected emergency can arise out of nowhere. If your personal finances have been exhausted and you find yourself in the emergency room facing surgery, the long-term financial impact can be life-altering. If you would be willing to consider taking out a loan, you may be able to generate enough short-term cash flow to cover the unexpected hospital bills, buying you some time to get back on your feet financially.
Before you take out a payday loan, cash advance, or charge a lot on your credit card, you’ll want to make a plan to pay it back. It’s simply a matter of making sure you have control over your debt at all times. Loans can be a good way to handle unexpected emergencies without having to make a long-term commitment to a lender, but it’s important to weigh your options and make the smart decision for your situation.
Business difficulties are a part of being in business. If your business is struggling, you don’t need to panic. What you want to do is figure out what steps you can take to stay afloat until the business cycle improves.