Given the choice, an investor trading in stocks or bonds would prefer to have profits from the sale of securities taxed on the capital account because only 50% of net capital gains are taxable. If those same profits are taxed on the income account, however, 100% of the gains are taxed as business income.
But what happens when someone ends up with significant losses?
This article will share about how to deal with business losses, here are some tips to handle significant losses:
Be Prepare to Fail
The first and the best way to handle business failure is to prepare for it in advance. It sound sounds crazy but it’s probably the best strategy for handling business failure. Nobody wants to fail and that’s why majority end up becoming failures. Business is a game of probability; where you have a 50 – 50 chance of either failing or succeeding.
Don’t take failure personal
The message above is straight and precise. If you’ve been hit by a storm in business; don’t take it personal, it’s just life. Don’t go banging your head against the wall because you won’t solve anything that way. Don’t go criticizing yourself; don’t regret ever starting a business. The fact that you failed in business doesn’t mean you are doomed to bad luck. It’s not your destiny to be a failure; failure and success is all about choice. Instead of talking down on yourself, cheer yourself up; you’ve just proved that you have the nerve to handle risk.
Taking responsibility for your actions is an essential ingredient to handling business failure and making a success out of it. Don’t go looking for whom to blame. If you were bad at cash flow management; admit it. If your business crumbled based on the decision you took or the business move you made; don’t deny it. Admit it and move on. Making mistakes is what makes us human.
Let your emotions flow
When you’ve lost a business; just let your emotions flow. Cry if you must and don’t feel bad about crying but I will prefer you do it in your closet. Don’t even think about hurting yourself because your predicament is just a phase that will come to pass. Allow your emotions flow because that moment of pain and tears will turn out to be one of your memorable and most inspiring moments in life.
Analyze the situation
Analyze the situation and circumstances surrounding your business failure. Where did you go wrong? What did you do wrong? What caused the failure? What would you have done to prevent the failure that you failed to do? These are the questions you should be answering at this point in time. If you don’t find definite answers to the questions; then you are bound to repeat the feat again. You can also pick the pieces or leftovers of your failed business. They may prove useful in your next business venture.
Resolve to Succeed
You can either use your business failure as leverage to greater heights or as a spade to digging your grave. The choice is yours. Instead of being cowed by your failures; use your business failure as a stern resolve to succeed. Each time I fail; I resolute to strive harder and smarter to cover for my losses and failures. Failures don’t weigh me down; instead, failure inspires me to success. You should strive to use your failures positively.
You have failed, cried your eyes out and learned some lessons. But the question now is: will you have the guts to start a business again? The word of God made me understand that the glory is not in the falling; but by rising each time we fall. Just as I said earlier; “I am not afraid of failing, I am only afraid to quit the entrepreneurial process having come this far.” In the business world, you are not yet defeated until you quit the game. As long as you are still in the game; even if you are hanging by a finger, you can always start again.
As a final note, failing in business is a painful experience; but it’s worth it if you go about it positively and make a success out of it.