What to Do with a Floundering Business

A struggling business requires immediate action. Here are your options.

Trinity Builder Solutions, my "new" business, is floundering. And that's the right word; it's flopping around, knocking things over, acting stable and competent one moment and then wholly unhinged the next.

It's exhausting.

You see, we started slow. But then we got some traction! Then, we made a key personnel change. Then we started to fly! We had a backlog! Then: Stop. Nothing. Not even a trickle of new work for months. Meanwhile, we were eating up the backlog, rockin', and rolling in the field.

Then, all of a sudden, the faucet turns back on, and while we’re not out of the woods, the future is bright.

So, what should my team and I do in this situation? More importantly, if your business is floundering, what should you do?

Start with Questions

What's working and what's not working?

Generate a quick list of what's going well and what's keeping you up at night. Brainstorming like this is a great way to get the synapses firing.

If you were to start over again, what would you do differently?

Months, years, or even decades later, you probably know much more about your business, industry, and team than you did when you started. (Or the last time it was all "working.") So, how might it look if you had to do it all over?

How is the team performing, as individuals and as a team?

A floundering business often has floundering team members. This is either the cause of or the result of the business floundering. Sometimes, market conditions start the dominos falling, but the results are team issues. If your team is still dynamite, this is a good sign: it's more about market conditions, and a pivot might fix it.

When you imagine this business's future, is it bright or dim?

Imagine how your business would look two to three years from now if it performed "above average." Is it accomplishing your goals? Is it serving you and your team? Is it making a difference in the market? If it were no longer around, would the market care?

Is your "founding hypothesis" still valid?

When you start a business or a division or launch a new product, you have a hypothesis. (Or, um, you better...) You have a set of assumptions of what the market needs and a vision of how the market will respond to your creation. So think back: is your hypothesis still valid? Did your assumptions come true? Did anything change along the way?

OK, now that you've assessed, it's time to act.

Your Options for Dealing with a Floundering Business

Kill It

Why?: You simply don't see a fruitful and exciting future, and keeping it going will cause eventual harm to you, your family, your financial security, and/or your team.

Why Not?: Your investment vanishes, and while I firmly believe in "sunk costs," you'd hate to kill something right before it turns the corner.

Ice It

Why?: The floundering is due to temporary headwinds, such as market conditions or a temporary inability for you or your team to focus.

Why Not?: Icing and then killing a business only delays the inevitable and adds unnecessarily to your burn rate.

Accelerate It

Why? If you're stuck in a "profit dessert" (a financial state where you are too big to be profitable but too small to generate sufficient new profit), you need to start paddling, and fast!

Why Not? Doubling down on something that is already not working is very risky. Before doing it, you should have data that tells you this is a good idea.

Pivot It

Why?: You know more now than when you started, and part of that knowledge is the market telling you to do something different. Perhaps this is offering an additional or alternate service, or perhaps this is offering the same service to a different customer.

Why Not? This typically requires taking steps backward before you can move forward, such as new or different marketing methods, team members, or equipment. It also means new or different risks!

At the end of the day, a floundering business MUST be addressed. Like a petulant child, it needs to be put in its place. Not doing so will lead to continued heartache, and your team will eventually show themselves the door due to a lack of belief.

Time is of the essence, so get going!

Thanks for reading this post. I appreciate you. In return, please share this with those you know who may be interested.

Books of Note: There’s no shortage of books on “time management,” but Buy Back Your Time by Dan Martell is different: the focus is not so much on how to make your work more efficient, but instead provides a step-by-step guide towards accelerating your business and your life by leveraging others. His approach toward scaling a team was insightful and thorough. Highly recommend!