Dahlia Akhaine

8 Aug, 2020

Need to discontinue your product or service? Here's how to close your business the right way

It doesn't come as a surprise to me that everyone talks (writes) about how to set up a business, drafting a perfect pitch deck for investors or creating a killer business plan.
But a crucial aspect of business (which we often ignore) is what happens when things don't work out.
And I understand it. No one wants to bear the thought of having a failed business. Accepting defeat is not an easy task.

In business, we must be honest enough (with ourselves) to accept what needs to change and what needs to go.

Have you have ever had to deal with recurring failure, constant disappointment, or loss even after trying so hard?
Did you think to yourself,
"I didn't try it this way."
"I should've tried harder."
"I need to get more resources."
While these are all valid reasons why a business or organization or product is failing, there is one central reason that is often not considered at all.
"The business cannot continue at this time."
Timing is such a crucial factor in the success of any business venture.
While we will take an in-depth look at how time (and other factors) can cause your business to fail, in this article, we will be looking at the steps involved in closing your business the right way.

1: Review: At the review stage, you have accepted that you cannot continue to run your business, perhaps due to the limitations in time, finances, or human resources. You review your goals, milestones, achievements, and believe that things need to change/ stop.

It is good to keep an open mind while in this stage as you may or may not make up your mind on the decision to close yet, but what matters is that you review reliable data and understand what was intended (goals) versus the actual outcome (performance).

2: In-bound communication: The first form of communication should be with members of your in-house team.
Whether these are personnel you hired, members of your family or friends, sit them down and talk about what you are thinking about and what you want to do.

Present the facts you've reviewed in the first stage and listen attentively to everyone's unbiased opinion on the steps to move forward.
The purpose of this activity is to examine the input from an outward review of your business/ product.
How do other people think things are going? What recommendations do they have?
Do they support your idea to close up the business or discontinue your product/service?
At this stage, there is no decision making, just honest communication, and sharing opinions.

3: Decide: This is the stage where you have to make your decision.
And yes, YOU have to make the decision.
As a CEO, Founder, Director, or whatever you like to call yourself, you have to own every single part of your business and brand, including its ups and downs.

Weigh your decision 60% based on your initial review and 40% based on the in-house feedback you received.
Remember that this is your business, your integrity, your commitment, your finances, your wealth, your opportunity, it's all you.
So ensure to make your decision carefully enough with all considerations.

4: Outbound communication: This stage exists for two reasons.
The first is for documentation.
- What has led up to this?
- What lessons have you learned?
- Are you deciding to close the business?
- If yes, what has influenced this decision?
- If no, what are you going to try differently?
- Do you want to suspend the business until a later time?
Document everything you have learned that could serve as a learning point in the future. You may also want to collect information from members of your team to be documented as well.

The second reason for outbound communication is to inform your clients/ customers/ stakeholders of your decision. Whether you've decided to change direction while keeping the business or you're packing up and closing for good, you need to (in simple terms) pass the necessary information across in the most efficient manner.
These may involve (but should not be limited to): - sending out emails
- text messages
- one-on-one communication etc.

Depending on your business operations, you may need to offer refunds or incentives to your existing customers. The goal of this activity is to be transparent with your audience and help them transition through the exit phase.
Recommend similar solutions they may decide to use in place of your service and provide direction on the next possible steps.
In this last stage, I want to congratulate you on doing one of the hardest things to do in business - close.
Like I mentioned at the beginning of this article, it's never easy to fail, and it's even harder to admit you've failed.
So well done.
Pat yourself on the back.
The hard part is almost over. Now review, learn, grow, and crush your next venture.

If you are reading this and you just closed your business, product, or service, I'd love to hear from you. Send an email to contact@bloomboon.com and share your experience.

And remember, you are not a failure because your business venture failed. You are a businessperson who is brave and smart enough to know when to pivot and change direction, or close and start something new.
Thank you for reading.