Sitting on an IKEA stool at the back of a cold food kiosk.
Only 5 to 10 pedestrians walking by my shop every minute or so during the post-celebrations of a public holiday
I felt a chill; not from the freezing winds of the air-conditioner, but from the fact that despite the “festive” season, sales were abysmal.
You may think that I am in the comfort of my own home while these words fall onto the page, that this is a story from my past, and it already is if you are reading this.
But this is my reality while this post is being curated.
A day ago, I was sitting in the landlord’s office, having a discussion with him about the future of our partnership. My mistake was thinking that a face-to-face session would be more productive than the waiting game on WhatsApp.
The discussion was a mere one-sided debate, and it ended with me deciding not to continue leasing my unit any further, and shut down my business.
The Reality
When a struggling business brings pain, business owners inevitably contend with the following dilemma:
“Should I shut down the business? But…(cue a myriad of reasons to justify staying).”
It is a painful thought that haunts us time and again, yet the real pain may not be what it seems.
A struggling business signals that pieces of the puzzle are not aligning, and sometimes they are out of our control.
For me, it was a combination of a bad location, high rental rate, poor visibility, and weak product-market fit.
I was trying to sell healthier bubble tea (using a natural sweetener) in an area where a majority of the demographic opts for cheap products, and was operating in a shop that is obstructed by a pedestrian bridge. Rent was given at a blanket rate among the units there, meaning that even though other businesses can possibly thrive, mine couldn’t.
As for the landlord, let’s just say they love to justify the rental with other units that are under their belt.
Some things are out of our control, hidden behind the very notion of “if we don’t try, we will never know”. We can be very meticulous about initial findings and knowledge, but there will always be a new challenge, a new situation, a new factor that will pounce on us in our journey. Sometimes, they can make or break the journey itself.
The Sunk Cost Fallacy
It is a shame, right? To have put in so much time, effort, and most importantly, money, into this business for it to eventually shut dowm.
The start of any business is always a gamble, because there is no fixed and certain outcome. Anyone who has been to a casino would know that once the investment goes in, the odds of you coming back out in the positive is slim.
In any business, money is lifeblood. You run out of it, and the whole operation will cease to exist. You need it for rent, labour, utilities, supplies, commissions, and a lot more. Even “self-running” businesses rely upon external forces to keep it going, like a subscription or web hosting, which requires money.
However, the longer we commit to a business, the harder it is to let it go, because any money not recovered from the start is wasted, burned, obliterated out of existence.
So we push through, keep the lights on, and pour our soul into turning the business into a work of art. Now knowing whether we will make it, not knowing whether things get better.
Sure, there is a hope that if we continue to stay in the business and work on it, there may be a chance for the business to encounter a great miracle of redemption.
But for how long? 1 year? 5 years? 10 years?
How many opportunities would have passed while we keep ourselves trapped in another lease and no certain future?
What ifs
“If only I had done this…”, “If only I had done that…”
Yes, if only you had all the knowledge you need from the start to know exactly what to do at each exact moment, then maybe you would be in a better position than where you are now. Maybe you will not have to shut down your business.
After working in my business for a little over a year, I have learnt a lot of new knowledge, and it sometimes feels like a curse, reminding me of the wrong decisions I have made.
As an example, I had to move out of my first shop when the landlord wanted me to pay for fees that I am not responsible for. In my desperate attempt to get myself out of that situation, I was able to connect with the previous tenant of my second shop who just so happened to be listing it for takeover.
I had the numbers they were operating on: rent, revenue, labour cost, etc. Despite this, my knowledge at the time was not mature enough to see the problems that were already in front of me, that:
- their revenue was too low to reflect a healthy business
- they were relying on underpaying staff. Staff weren’t even allowed to work
- there were news outlets reporting on the economic changes of the are
- the takeover fee did not accurately reflect their profits and equipment costs
- foot traffic only occurred during the night and not the day (night-life district)
Needless to say, “if only…” thoughts continue to plague my mind till this day.
Burnout
The more you stay stuck in a hopeless environment, the more dread you experience. The dread of starting the day, slaving your way through tasks that no longer light a spark, facing employees whom you know are relying on you for their livelihoods, and dealing with customers who can be more demanding than a child throwing a tantrum.
It creeps in through your sleep, you wake up feeling like any effort you put in the business is not enough, but you keep going anyway with the blind hope that things will get better.
But blind hope is THE driver of burnout. You can work on the business all you want, but at the end of the day, if the reality of your situation does not take up a semblance of space in your mind, then you will end up emotionally and mentally drained.
This is when the question, “should I stop doing this?”, takes its most visceral form, tempting you at every corner you turn. You feel a faint force tugging you, trying to pull yourself out of this hole you have dug into.
The heavy sinking feeling in your heart will stay stuck there while you stay stuck in your business. And until a drastic change occurs, you will be carrying this burden for a very, very long time.
Better to fail now than later
It is part of human nature to reject failure. It reminds us of our mistakes and the poor choices we have made. It signals to us that we are not good enough, that we are not worthy of running a business we so desire.
It is a very universal experience, though there is definitely a better perspective.
Which of these is the lesser of 2 evils: failing now, or failing after 3 more months of struggle? The former now seems more appealing.
Why so?
For one, the extra struggle doesn’t seem worth the time, energy, and money to pursue. Remember, we are talking about blind hope, and unless you are 100% confident that the next 3 months is guaranteed to bring about certain success, we have to make the tough decision and cut our losses.
Secondly, 3 months is an ample amount of time for change if your energy is properly redirected. Imagine the amount of opportunities that can pass during these 3 months while you are sitting in the office contemplating your life. The opportunity cost will accumulate by the hour and those opportunities are arguably better than the one you had when you first started your current business.
Think about it. How much have you learnt in your current business (given that you have actually actively worked on it)? You have already enrolled in a real-life business course through running your business. With these new “study materials”, will you be able to build your next business better?
The answer is a definite YES.
And this process will keep repeating. You will learn, fail in some minor things, fail in some very major things, but at the same time gain a wealth of knowledge that allows you to take another step in the right direction.
Failure is almost necessary in anyone’s success story.
Sitting in failure is calming
The decision has been made to shut it all down, and now YOU are sitting on an IKEA chair in your office. If you have never reached this point in your journey, then I can share what it is like for me.
There is almost a certain calmness in my mind. Granted, I have had my fair share of personal growth and failures before starting this business, so the mindset I have cultivated allows me to see the hope in my situation.
There is calm in knowing that the burning pain will eventually subside, and that I will be able to breathe.
There is calm in knowing that despite the inevitably of the business shutting down, there are more opportunities that await. New business ventures, job openings, freelance gigs that can allow me to rebuild myself.
There is calm in knowing that the failure I am experiencing is proof that I have started something and tried. Such proof is hard to come by for those who never take the first step.
Before my big decision to shut the business down, I was naturally fearful and anxious. Thoughts of being a failure of a business owner crossed my mind plenty. Conversations with friends and families about my business shutting down amplifies these thoughts by the multiples.
But the exact moment when I crossed the fear and made the decision, it is almost as if I have stepped into a new reality where the new messaging is:
“it’s okay”.
It’s okay to fail. It is not the end of the road, and the world is not actually falling apart. The world will continue to move forward, with or without you.
If you choose to move along with the world, then you will be able to feel a certain calm and confidence. This juxtaposition of calm in the middle of a not-so-favourable situation is a rare experience.
And no, you are not a failure. You are a person who is learning and growing. Remember, such experiences is hard to come by, and you have a choice to turn it into something greater.
So seek the next opportunity!
It is always okay to end a business that you have poured your heart and soul into building, and build the next one.