I was watching this business man talk about being in business and how to become a successful entrepreneur, and I loved the advice he gave: Sometimes in business you have to quit.
We always here the old phrase, “Never quit.” Or how about, “Don’t Give Up.” Even worse, “Quitters are Losers.”
Now, I’m not a proponent of quitting. As a long distance runner, I push myself extra hard most mornings to get to the finish line, whether that line is three miles or 15. I have a difficult time quitting, even when I know that quitting may be in my best interest-for instance, when my knee begins to hurt, or when I see that my idea is eating away more money that I can recover in a fair amount of time.
I believe in business we have to know when to quit. I recall watching this show a while back about a woman who had invested all of her family’s money into this plastic gadget to help hold nail polish. The gadget was not selling. Consumers didn’t like it-even said that it didn’t work-and yet she was convinced that she would make millions off of this idea. She spent hundreds of thousands of dollars producing a storage bin full of these things that just didn’t sell.
Her husband begged her to quit.
Her kids begged her to quit.
She didn’t want to quit.
Sometimes quitting is good.
I used to love the show Friends, but once Rachel had the baby I felt like the show would be best off quitting while it was ahead. Just like Seinfeld, you have to know when to get out so you can stay on top.
Business is the same way.
How do you know when it is time to shut the doors?
-You are losing more money than you know you will be able to recover in the time frame needed
-You are jeopardizing your family’s well being for the business (ie: can’t put food on the table, used up all of the kids’ college fund)
-Your market research shows people don’t like the product or service and you don’t have enough money to fix it as they state it needs to be fixed
-You find that you are not retaining old customers or pulling in new ones
Developing an exit strategy for your company is one way to keep tabs on whether it has come time to pack up or to continue hanging in through a rough patch.