Lesson's Learned From My Failed Business
In today’s episode: I will share my small business failure. While I ran a successful business on one hand, it just wasn’t enough. We will talk about the lessons I learned and how I’ve turned my 2nd business into a success and soon my 3rd
Here are the Show Notes from the Episode:
**keep in mind that show notes are raw and only highlight what is in the episode. Listen to the show for the full content**
Episode 24 – How I Survived a Failed Business / Air Date: November 16, 2016
The Local Small Business Coach
Surviving from a Failed Business is Possible!
Welcome back to the Local Small Business Coach Podcast, I am your coach Tammy Adams.
Today I want to discuss something that impacts many of us. Maybe in your past, maybe in your future or maybe you are going through it right now. Let’s talk about Recovering from a Business Failure.
Now, I’m going to be honest with you. This not going to be an easy podcast episode for me. While I have become passionate about the topic, it was not a fun experience when I went through it and it still stings. But I know that it is critical that we discuss this topic since I know that I am not alone and some of you are going through this right now.
Please know that failure comes in many forms. For some of us, we had well ran businesses but they were the wrong business at the wrong time and then the financial crash took us out. Were any of you a victim of the recession we had? I know I fall into this group.
For others, maybe they made all the wrong decisions and they just bled losses and the business went under. Truth is, there are many reasons a business can fail. We actually covered many of these in Episode 21 where we discussed 25 Ways Local Small Businesses Fail.
Today, I want to focus on how you recover once you do go through a business failure.
Specifically, I will share my journey.
If you are like me, you are someone that loves to succeed. You might even be a person that doesn’t do failure well. I know I don’t. It crushes my heart, my spirit, my soul. I work so hard at succeeding that failure isn’t an option. So when I do fail at something, it crushes me.
Now, don’t get me wrong. I’m not perfect. Far from it. I make a lot of mistakes. But for some reason, I never equated mistakes as failures. Which is funny since a mistake is a mini failure. You just recover faster.
When I left my corporate job after 22 years to take over a local small business, there was no doubt in my mind that I would succeed. I looked at this business’s books, I saw a $48,000 loss but instead of running, is saw it as an easy fix for me to turn around. I was right. I did get it to a breakeven in one year.
Now, I know what I would be thinking if I was you listening to this part of the story… what the heck were you thinking Tammy!? I laugh now, but usually I just look in the mirror and shake my head. I was so caught up in how I could turn around the business, I failed to factor in what the heck was I going to do to then turn it into a livable income?
Here is the worse part. I left my successful job in November 2008 and took over the next week. I remember sitting in a hotel at my training orientation for the franchise and watching the stock market tank. My heart sinking as my entire savings to live off of while I get this business turned around was disappearing overnight. Later that year, my rental homes tanked right along with the stock market.
Six months later I no longer had a great salary, my stock was disappearing fast, my rentals were underwater and I had a business that was losing money and losing customers fast. My entire town was disappearing as folks walked away from their homes and left our small town.
If I was smart, I would have ran for the hills and protected what little I had left. But noooo, for some reason I thought I would survive. I would succeed just like I always do.
For the next 5 years I struggled through the crash and two competitors opening up. Every time I would get back to even and making a great increase on my customer count and sales, the next hit would come. Each year, just barely breaking even.
Now, I will brag a moment. I had a very well ran store. I even had the head of the franchise in my store and they were very happy. I became an advocate for low volume stores and the struggles we went through. Since my Profit and Loss was so clean and I ran a tight ship, no one could blame it on my poor leadership or people. I was able to help them face the realities of a low volume store and to look at what I couldn’t control.
During those 5 years, I lived in my store. After all, the best way to keep my payroll to a minimum was to work as many shifts I could during the dead times to save wasted payroll. While I was able to control my products and inventory, I was getting killed by my lease and my electric bill. Do you know how much electricity 7 freezers and refrigerators use? Just know it was thousands a month. My landlord refused to work with me and was perfectly fine with leaving all the units vacant. He had a giant tax write off and my little store didn’t seem to matter.
One by one I watched many local businesses in my town close up shop. People would come into my store and beg me not to close and leave them like everyone else. Silly me bought into this. I wanted my little town to have a win. There was no way I was letting their ice cream shop close down too. In the end, my loyalty to them was greater than their loyalty to me.
After 5 years of breaking even, and losing almost everything I had built financially during my 22 years with Home Depot, I had to wave the white flag and close up shop. I had to concede and decide on my next steps. It was time to admit failure, like my wounds and move on.
At this point, I had to decide, do I go back to corporate America or do I do another small business? By this time, I knew I could never go back to Corporate America. I needed the flexibility and I had the local small business fever. The good thing is, even with the pain of failure so raw, I knew I could do it. I just had to figure out how to survive first.
Long story short, I decided to become a Real Estate Agent. It gave me the flexibility I needed for my family commitments but I still got to have a local small business. I was my own boss. I got to determine what my income was going to be. I got to take my customer service into my community and build the future I knew I could.
For the past 3 years I have done well. In hindsight, it was the best decision I could have made. Not only did it solve my income problem, but it allowed me to continue to interact with tons of local small business owners. Specifically, the mobile owners who went into people’s homes. I had my passion rekindled to help local small business owners. A passion I have had since starting that first small business. But that is a story for another day.
Let’s go back to that tough decision back in July 2013.
Early on in 2013 I had hit a crossroads. I had to make a tough decision. By now my heart was crushed. After spending my entire life succeeding, I had to acknowledge that I was on the brink of failure. I was slowly bleeding away all my life savings and facing destroying the great credit I had. I was responsible for multiple households and I could no longer risk their housing due to my stubbornness.
I tried to sell the business, but alas, I couldn’t find another sucker like me, to buy this failing business. I had to laugh, no one wanted a break even business, yet here I was the idiot that bought it when I was suffering huge losses.
In June, I made the tough call and picked a date in July that I would close the doors for good. I began to find buyers for my equipment and inventory. Then after one last family night, without my customers knowing that this was their last time enjoying their Tuesday night with us, we secretly said goodbye. The next day they would find their favorite ice cream shop was the next victim of the recession.
For most of 2012 & 2013 I was full of emotions that were foreign to me. I was lost, I was scared, I was hurt and worse of all, I was disappointed with myself. Thank god I was responsible for others and needed the money. It forced me to throw myself into my new business. But in those quiet moments, my heart would ache. I felt like such a failure.
Those close to me would tell me I wasn’t a failure. That I did all I could. While intellectually I might agree, it didn’t change how it felt. It still hurt.
The only thing I had going for me is, I am a pretty optimistic person. I try and focus on the positive and where I’m going and what I can change vs what I can’t change. I couldn’t change the decisions I had made. All I could do is learn from them. I realized early on that feeling sorry for myself wasn’t going to change my situation so I would only allow myself 5 minute pity parties. The only thing that would change my situation was me doing something.
I became determined to make my next business successful. And I did.
I’d love to tell you that you get over failure quickly. The reality is, you don’t. It takes a bunch of baby steps. With each baby step you get a little further past the worse part. It gets a little easier each day. Some days are good and some days suck. But the key is to keep moving.
The best part is, you get a little clarity on what happened and what you would do differently. While the sting is still there, the mind becomes clearer.
I look back at my journey as a local small business owner and it has highs and lows. Successes and failures. I learned that my business skills were transferable into both of my local small businesses. I learned that there are unique challenges though that we face as local small business owners. I’ve learned that brick and mortar have different issues than mobile business. I see the past 8 years as one hell of a ride and one heck of a learning experience.
While I would have preferred to not to lose so much financially, I wouldn’t trade the failure and the lessons. It has made me a better business person. It has provided me unique insight into what local small business owners face every day. It allows me to reach out to you today and share my story in hopes of giving hope to some of you.
Maybe you are in the same shoes I was. Holding on to a business that you need to let go of but afraid of facing the failure. Afraid of wondering what the heck do you do next. Afraid of what others will think of you. Afraid to show you are human.
I’ll be honest. Sharing my failure isn’t easy and here I am putting it into a podcast that will last forever. Everyone will now know my worse entrepreneurial moment by me sharing my biggest failure. It is like opening up a wound that has been scarred over.
So why am I doing this? Because if I can help just one of you, by sharing my story then it will be worth it. If I can help others realize it is ok to fail. That you will not explode, that life isn’t over and you will survive, then it will be worth it.
Here I am, 3 years later and things are looking up. I’ve built a business that covers my bills and I’m embarking on my dream business of helping local small business owners. The future is so exciting to me right now. Three years ago, I had nothing to be excited about.
I do believe a higher power than me wanted me to go through those tough years. It was how I could help others. I needed to feel this pain, to experience this loss.
If you went through a similar failure in the past, you know exactly what I mean. You felt that crushing feeling, that loss of your spirit, of your light. But you also know that you will survive. That you could build an even better business and you could be even more successful.
If you are going through it right now, I promise you, you will be ok. I don’t know how far you have to go down to hit bottom. But when you do, you will bounce back.
The key to any failure is to learn the lessons that failure was meant to teach you. For me, I learned tons of things I would never do again. I’ve learned not to hold on to something for an emotional reason when intellectually all signs point to moving on. I learned to never hold onto something just because I was afraid of failing and what other people would think. I was willing to lose everything to protect some image I had. How stupid was that?
I am so glad I came to my senses in time before I really did lose everything. I thank god that I was responsible for others. This is what pulled my head out my butt. I couldn’t drag them into my stupidity.
If you are going through this now, what can you hold on to? What gives you your purpose? What can you fight for? What can be your lifeline?
There is a quote by Winston Churchill that comes to mind: “Failure is not fatal: it is the courage to continue that counts.”
I want any of you that is facing failure to know, you will be ok. You will have the courage to continue. You will be successful again. You will survive and you will come out of this stronger than ever. I know I have. It all starts with those baby steps in the direction you want to go. Just keep stepping. And when you are knocked back, it is never to the beginning. You will still have progress on your side and you will get up, dust off and keep attacking.
For those of you that have been through failure, I challenge you to help others by sharing your story. Let those facing the worse time of their business career and personal life know that they will survive, just like you did. Just like I did.
I will continue to share my journey on this podcast. I will continue to give hope to those needing some. I just need one thing from you. Never give up. This will past. You will come out stronger. I promise.
And with that, I should bring this episode to a close.
Don’t forget, that I’m starting up some one on one coaching calls and to have some fun with folks from the podcast, I’m going to give away a free coaching call each week. What I’m going to do is, for all of the folks that leave either a review for the show or leave a question for the show, I’ll toss them into a hat and pick a random person to get the free coaching call. So once you leave either a call or rating, shoot me an email at firstname.lastname@example.org to let me know and I’ll make sure you are included in the drawing.
So until next time, remember, if you like what we are taking about, then make sure to subscribe to the podcast so you don’t miss an episode, if you love the podcast and what we are talking about, then please leave that 5 star review so other local small business owners know this is a podcast that they can’t miss.
And don’t forget to visit the website at LocalSmallBusinessCoach.com to leave your question for me to possibly answer on the podcast in the future. You can leave it via the Speakpipe button or just shoot me an email.
Meanwhile, I wish you the best in your business and remember: Great Customer Service, coupled with Great business practices will set you on the path to Great Profits!
Bye for now…..
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See you on the next episode!