Let’s talk about a difficult topic: failure. No matter how much you try to avoid it, you’re expected to experience some kind of loss as an entrepreneur.
But don’t let this harsh reality bring you down. There’s always a silver lining in every failure you encounter. Here’s how you can bounce back from a bad break.
Acceptance: Failure is real
A study conducted by Fundura revealed that of all small businesses, :
- 20% fail in the first year
- 30% fail in the second year
- 50% fail in the fifth year
- 70% fail in the tenth year
Failure depends on the industry you’re in (with restaurant businesses having a high survival rate of 85% in the first year), as well as other factors (such as management styles or product demands). According to a CBInsights study, some of the main reasons businesses fail are:
- There’s no market for a brand’s products or services
- A lack of capital to manage business expenses
- Lack of team dynamics
- Outcompeted by rival businesses
Regardless of the reason, failure is imminent in running a business – but the best entrepreneurs learn from these failures and transform their brands into winning firms.
The Fail Fast Approach
Successful entrepreneurs follow the “fail fast” philosophy. Simply put, this mindset identifies factors that aren’t working for your business. Once pointed out, you cut these losses quickly. If it’s not working, you pivot your business to something that’s more likely to succeed.
Of course, it looks good in theory – but it’s hard to implement. It can be frustrating to drop ideas you’ve worked so hard on for your business.
It can also be painful to realize that the work you’ve put in isn’t what your market needs. But by getting over these hurdles, you’ll realize that your business may potentially be better in other avenues.
Acceptance: Success (after failure) is also real
By considering failure as part of the entrepreneurial process, you can now plan ahead for what’s to come. And to prove that you’re not alone in this experience, here are two local entrepreneurs who failed—then succeeded!
From toothpaste tubes to happy smiles
Lamoiyan Corporation CEO, Dr. Cecilio K. Pedro, proved that a pivot may just be the thing a business needs when facing a hurdle.
Originally managing an aluminum tube manufacturing business, Aluminum Container Inc., Dr. Pedro aimed to supply toothpaste tubes for local companies.
However, his clients (big names like the Unilever Group and Colgate-Palmolive Co.) decided to use plastic toothpaste tubes instead, making his products suddenly irrelevant. It was devastating, yet the founder decided to turn this failure into a learning experience. In just the same year that Aluminum Container Inc. closed (1985), Dr. Pedro failed fast and decided to create his own toothpaste brand.
In effect, he decided to create a brand that will compete against his previous clients! Naysayers were plenty during the initial launch of Hapee Toothpaste – but as the years proved, Dr. Pedro’s pivot was a success!
It may be one of the simplest businesses in the Philippines, but Arnold Viado proved that, with a goal in mind (and by staying hungry for success), a balut business may just be a very profitable venture.
Failure was never an option for Mr. Viado, even with a physical disability hindering him from doing simple tasks. With a goal to provide more for his family, Mr. Viado focused on how he can make his balut business earn more.
Deciding to invest in a loan, the humble balut vendor expanded by increasing the number of his egg incubators. With an increase in production, Mr. Viado then decided to formalize his sales by applying for a business permit.
Since then, his business now supplies for other balut vendors, giving him the flexibility (and profit) to develop new solutions for his market.
Rise above your failure
Failure isn’t the end of your dream. Learn from your mistakes, and focus on what you can do better. Who knows, success may just be right at the corner!
Image source: Unsplash