May 11th, 2018 | By Peyton Sawyer
Experiencing a bad quarter can be rough on any business owner, especially when your income and livelihood are solely dependent on your business profits. Feeling disappointed and anxious about the upcoming quarter is pretty much the norm, but that certainly doesn’t mean that you are headed for disaster. It may just be a temporary setback before a larger comeback.
Taking the time to thoroughly review the details of each quarter after it has come to an end is a great way to stay on top of your business, spot problem areas and make note of strategies and tactics that worked. Even if you have experienced a rough quarter, it’s essential to examine the “why and how” in order to improve going forward. Don’t make any reactionary decisions that can cost you more than just the losses from one bad quarter. Look look back at the overall picture with an objective eye and plan ahead accordingly.
Here are a few helpful tips that can get you through a rough quarter and on to the next.
Assess the Situation
Recovering from a bad quarter takes more than just hoping for a larger profit. You need to assess the situation and determine your problem areas. By reviewing your sales reports, product availability and expenses, you may get a much better idea of why you had a drop in profitability. For example, the numbers may reveal that some inventory did not sell as well as expected, your new customer growth has slowed, or that your operating overhead has increased, cutting into your revenue.
Once you determine the issue or issues, you will have a clearer picture of how to proceed moving forward. Don’t let the stress of it all cause you to try to overhaul your entire business plan when all it probably needs are a few minor changes to get back on the track to profitability. If you need access to liquidity in order to resolve the problem, there are a variety of funding options, lines of credit and small business funding to provide the funding you need.
Create a Plan
Creating a plan to rectify the situation could be as easy as having a sale or running a promotion during the next few months to move products that did not sell in the previous quarter, devising a stronger advertising campaign, or cutting some unnecessary expenses. While fixing the problem may be easier than you thought, not having a solid plan of action leaves you with plenty of room to fail. Establishing a clear and concise list of goals and guidelinesgoals and guidelines can make all the difference, especially when so much is riding on the next three months.
Look at the big picture. There is no need to restructure your entire business model after one bad quarter. In fact, making dramatic changes in reaction to a bad quarter is almost guaranteed to make things worse, and leave you with an even more unclear insight into the original cause. It is more prudent to make small, strategic adjustments to your business model than to make sweeping changes that can cost your business even more money and time that you simply do not have.
Don’t Stand Alone
Let your employees know what you are dealing with, because more than likely they are already aware of the slowdown and want to be part of the solution. When sales are down or you aren’t attracting new clients like you used to, your employees can be integral in reversing these types of negative trends. If necessary, you could get them involved by asking for their insights and opinions, or even introducing an incentive program to increase profits. It is human nature to work harder if a reward or bonus is a possibility. You can even make it a contest, because most of us have a competitive nature that drives us to want to come out on top. By giving your team the opportunity to help both themselves and your business at the same time, your next quarter is almost guaranteed to be brighter.