As entrepreneurs we are often blinded by the enthusiasm behind our ideas, our passions and our drive to make it all come together. This thought process is made even less logical when you have tasted success in the past, but now must face the reality of a shifting market, a down economy and a business that is bleeding cash. I recently had a prospective client come to me who was in dire straights; her business had once been pretty profitable but is now dumping money left and right. This prospective client came to me because she had no web presence at all and her retail store has been losing money for over a year.
Her biggest question was “How do we capture users through the internet to grow my business?”. The sad answer to this was that in her particular category the margins were low (in dollars, but but high in percentage) and depended on high volume to make sense financially. As I looked through Google search volume in her appropriate keyword set it became apparent that the reason her retail store was dying off wasn’t just do to this area, but in fact the entire market has shifted away from her category. The only real way she would have had a chance right now is if she had been a first mover to shift towards the web and become an authority for her sector. Unfortunately now though, her sector is saturated, dying and EXTREMELY competitive; the numbers just simply don’t make sense anymore.
Her passion is admirable, and her work ethic is on par with what is needed to run a profitable business; however fire and hunger are simply not enough to make an unworthy market sector work. So as entrepreneurs, what have you done to create a separation from your idea to make the most logical and reasonable decisions about staying in business or not? The best entrepreneurs are the ones who have failed the most, but also known when to cut their loses and move on to a new idea.
