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6 Reasons Why Your Business Is Failing

Entrepreneurs are stalwarts of any economy. They create the jobs, they pay the taxes and they provide us nearly all of the great things we enjoy every day. If you own an establishment of any sort that has visiting customers, then this article is for you!

Recently, I watched a few episodes of a show called “Bar Rescue” and found it interesting. If you don’t know what it is, the show takes Bars and Restaurants that are in financial trouble, fixes them up, and tries to get them on the right track.

If you’re an entrepreneur, or an aspiring entrepreneur, then shows like this are a great way to spend your downtime. Not only are they entertaining, but you might learn some valuable business lessons. Shows like this can tend to be a bit dramatized, so don’t take everything at face value, but learn what you can. Here are some tips for you.

1. Sanitation is Important in Many Businesses

If you think your lack of customers is the biggest problem for your establishment, then you better be sure that your sanitation is up to par. A few episodes into Bar Rescue, you’ll see how important cleanliness is to them, and for good reason. There are two levels of dirty:

  • The kind that makes people go “Eww, gross!” and walk away.
  • And, the kind that makes the health department lower your grade, fine you, or worse – shut you down.

This is clearly a big problem in the restaurant and bar world, but even if you aren’t subject to the health department, your customers will appreciate your attention in this. Your business already has enough competition, so don’t lose customers over something as dumb as a dirty entrance. You’d like to think this is common sense, but here are some things that I’ve seen personally, and on the show:

  • Dead insects and animals. This is disgusting, whether it be a restaurant or retail store.
  • Tongs hanging on the edge of a Garbage can.
  • Dirty bathrooms (roaches, pesticide cans, and things I’m too nice to write here).
  • Garbage cans next to tables (not near, basically touching).
  • Food on walls and windows (clearly not recent either!).
  • Garbage on the floor (inside! Crumpled up wrappers, tin foil, napkins, etc!)

These are the silly things that can ruin a potentially successful establishment. Keep it clean!

2. Bookkeeping is Important to Running Your Business

Another common problem are financial books that are in complete disarray (or worse, they don’t exist!). If you plan on traveling to the other side of the country, would you drive there with your lights off and without a map or GPS?

Books are like your lights and map, they let you see where you’re going. Now, if I drew you a map by hand, would you prefer to use that, or a real map? Of course, my map might get you there, but it is probably nowhere near as accurate as an actual map.

The same goes for your books. Your understanding of your business is only as good as the quality of your financial records. If you have terrible, undetailed records, then you probably won’t know why you are failing or succeeding. There is no excuse for terrible books when there are excellent pieces of software out there like GNUCash (Free, but steeper learning curve), and Quickbooks (Cheap, but more intuitive).

You can’t claim ignorance on your knowledge of the software because SCORE.org offers free local seminars on using Quickbooks all the time! You have no excuse for having terrible financial books, fix it!

3. Bad Employees Will Ruin Your Business

Your friends are so fun to hang out and chill with, why wouldn’t you start a business with them? There are tons of people that I really enjoy the company of, but when I consider them as a partner I realize they would be a horrible choice.

The person that makes you laugh, might be fantastic at getting you into a good mood, but can you depend on them to be responsible when the moment calls for a serious response (not a joke to brush it off).

I know your boyfriend or girlfriend is really cute, but will it last, and will they still be there when it is over? Furthermore, will you want to be stuck in a partnership with them if the relationship does fail? Worse, would they make the business fail to get back at you?

You shouldn’t let your personal relationships turn into personnel problems. Your friends, family, boyfriends, and girlfriends might be amazing in one aspect of your life, but they may not be suited as a business partner. Just because someone makes you laugh and smile, it doesn’t mean they’re ready to be CFO.

4. Your Business Identity Should Be Clear

A common problem is the identity crisis many establishments seem to have. Smaller establishments have this problem for multiple reasons such as:

  • There is only one location, so they don’t have a set theme yet.
  • The establishment will reflect the owner’s interests. People by nature are interested in many things which creates the issue.
  • The owner may not care about the theme and just fill the place with any cheap decorations they can get.

Ambiance is one of the main reasons that people go to establishments such as restaurants and bars. You can have a cool tropical name, but if you don’t deliver that tropical feeling, that tropical ambiance people want, then you are hurting your brand.

If someone sees a sign that Says “Bobaloos Tropical Tiki Bar” and decides to go, you better believe that person is looking for a Tiki Bar experience. Don’t lose your identity trying to do too many things. Pick your identity, and do it better than everyone else. If you can’t, then people have no reason to visit you.

5. Don’t Let Fear Paralyze Your Business

The biggest surprise I’ve had watching Bar Rescue is seeing the fear that has engulfed many of the business owners. I understand, the business is in dire straits, and I also understand the show is trying to make it look worse than it is, but there is an unmistakable fear that I see.

Being an entrepreneur takes guts. You can’t just quit a job and start a business without having guts or being really dumb. My bet is that most of these entrepreneurs have guts! I can tell that there was a fear before the problems started. There was a fear to commit to a theme, there was a fear to fund the business properly so they could buy the materials they needed.

There are a lot of phrases: Go big, or go home. Succeed or die trying. Failure is not an option. All of these phrases mean the same thing: do your best, and don’t hold back. If your intention was to deliver a mediocre experience, mediocre goods/services, at low, mediocre, or high prices, then you had the wrong attitude from the start; you need to fix it or get out now.

6. Invest in Your Business!

Maybe the fear exists because you finally see how much it will really take to get the business going, or maybe you are just cheap. You’ve already done the hardest part! Why not go all out and do it right?

I’m not endorsing making dumb decisions, but if you are running a restaurant, and you routinely run out of the food you need, then you are Scrooging it! Bah, humbug.

Wouldn’t it be better to have too much food, and meet demand, than to have too little food and have angry customers? With the surplus food, you could cook it up, feed the homeless, and help people!

I tend to speak from a more spiritual perspective, so I don’t endorse doing the right thing to get something in return, but I don’t deny that doing good things can result in favorable exposure.

Feeding the local community could earn you a place in the hearts of the people, and that means repeat business. Yes, it is easy to Scrooge it, and hold onto that single cent, but what good will that cent really do you? Even if you don’t win over the hearts of the community, you did the right thing.

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