Entrepreneurs are, by nature, some of the most optimistic people you will ever meet. They believe in a better future, and they believe their efforts will create that future. I’ve seen this trait in almost every one of the thousands of entrepreneurs we’ve worked with over the years.
That said, there are always times when entrepreneurs are pushed to the brink. They seriously consider throwing the towel, quitting their current business, and moving on. The moving on might include retiring, working for another business, or starting a new business.
I know a lot of businesses have this feeling now in the age of the COVID epidemic. Is it time to give up?
The Great Brown Water Debacle
Kona Impact has only had one such time: several years ago, we had a major brown water leak into our office space. The space above us was unused for a long period of time, and the building was so poorly maintained and inspected that the piping was rusted out. This caused a massive flow of brown water into our unit. We knew it was bad when the plumber would not even do any work until the mold and hazard remediation business did its job.
Our property manager was extremely negligent in dealing with the issue, so it was a whole week before anything was done. It was then another week before we could enter the office. We lost thousands of dollars of suppliers and many thousands of dollars in lost projects and productivity. We knew that we would be stupid to stay due to the horrible property management and the poorly maintained building.
Is it time to quit?
This is when I seriously considered shuttering the business. We did not see much chance of the economy improving in the near-term, and I knew it would take thousands of dollars to find a new place, make it work-ready. Moving would shut us down for at least another week. We’d also have to commit to a 3-year lease.
Well, long story short, I decided to press on.
We found a new space that was twice as big and it was the same rent. Some friends graciously pitched in and helped to repaint the inside of our new place. My employees did a stellar job of getting everything set.
Glad we didn’t give up!
A few months later, our business started to pick up, and due to the bigger space, we were much more efficient in our workflow. We ended the year up about 15% from the previous year. Since then–nearly five years ago–we have grown the business about 200%.
Here is what I learned from that time:
- Many things outside of your control will affect your business. Keep your cool during these times, and don’t make rash decisions.
- Try to figure out if these obstacles are temporary, short-term, or long-term problems. A broken window is temporary, road construction is probably short-term, and, unfortunately, COVID 19 is going to be a long term issue for most businesses.
- Be prepared to leave a bad situation. A landlord or management company that treats you poorly is not worthy of your money. Leave.
- Try to take a six-month perspective. Is there a reasonable chance that things will be different in six months?
- Always keep at least six months of operating expenses in reserve to weather storms like this.
- You might be surprised at how little your insurance will cover. Review your policies often.
- Seek out and accept the support of those around you. Entrepreneurs often place an undue burden on themselves.
There are lot of businesses seriously considering quitting now due to the response to the COVID pandemic. I feel great empathy toward those who find themselves in that position now.