My software business is in trouble. For years we have made poor profits and sometimes a loss. I am barely making a decent salary.
When do I decide to call it quits?
Well, not before you do some benchmarking and serious investigation. Jump on the public records of your competitors. Scour their websites.
Are your operating costs and overheads equal to competitors? No fountains in the foyer or fancy cars? Operating on a shoestring?
OK. So what are competitors, who are making profits, doing differently? Can you change your model, distribution, strategy? Is there a new innovation or hot new market to explore? Can you outsource to lower your costs? Can your products be made in cheaper countries? Are your competitors’ staff more efficient, work harder, more skilled? Can you poach them? Do they carry out operations differently? Is their technology better? Are they more skilled at SEM and SEO?
If you cannot pinpoint any major differences, then bad news. If there is no way to change your circumstances, the best option is to close it down rather than increasing the investment to offset the losses. And Ben, if it doesn’t work out, take heart. You have tried and have experienced honest failure.
That in itself is a badge of honor! And think what you have learnt for your next venture.