Welcome to Ask an Expert Business Series with Misty Lambrecht, the owner of Webfoot Marketing and Design, sharing valuable insights based on her extensive 15 years of experience in business startups and advising in Lincoln County. Being a leader of an organization is likely the most challenging role you will ever assume. When you hire an employee, you become a crucial part of their lives. They depend on you to ensure timely paychecks for themselves and their families, to provide the necessary safety equipment, training, and resources to perform their jobs effectively.
On a more demanding note, they rely on you to make critical, sometimes unpopular decisions. It requires you to be honest with yourself and recognize when you are out of options. This reminds me of an old country song by Kenny Rogers: "You've got to know when to
hold 'em, know when to fold 'em, know when to walk away, and know when to run."
One crucial indicator that it's time to consider closing a business is when you find yourself consistently dipping into personal savings or taking on significant debt to keep the company afloat. While every business faces financial ups and downs, if you're repeatedly injecting
your personal funds to cover operating expenses or relying heavily on credit lines, it may indicate that the business model is unsustainable.
It's important to assess whether the financial strain is temporary or a long-term issue. If it's the latter, it may be wiser to make the difficult decision to close the business gracefully, allowing you to protect your personal financial well-being and minimize the negative impact on
employees and stakeholders. A hallmark of a good leader is the ability to make critical decisions and communicate them clearly, even when the news isn't favorable.
Don't lead your employees, customers, or creditors on when you can't meet their expectations. Communicate as an authentic leader with honesty, as it will take you further than hiding, avoiding phone calls, or going on vacation to avoid face to face conversations. Escaping to Tahiti during tough times will only leave you sunburned and further in debt.