How long in years should I go before I give up and close down a business that is unprofitable?
I was listening to a podcast where Kelvin O'Neal1 was featured. He said, "If you are not making money after 36months(3 years), you've gotta take a behind the barn and shoot it. It's just a hobby. It's not a business."
According to him, "people can get so stuck on a bad idea that they just keep thinking that if I keep working on it, it's going to fix itself. It doesn't fix itself. It was put on your journey to teach you, what not to do."
I agree with Kelvin O'Neal's statement, what he said I have experienced before. In 2016 I opened a business from scratch, needed unexpected capital such as decorating a business place, buying needed equipment such as shelves and other unexpected needs. The first year I couldn't do much, my business didn't go as expected. Entering the second year, not much has changed, the capital I invested in doing business began to decrease due to financing my daily needs.
Then I started thinking in the third year, if things like this continue, my capital will run out. I started to apply the marketing science of selling capital, there is no profit that can be obtained every time a transaction occurs. After running for almost two months, consumers began to increase, maybe because the goods I sell are cheaper elsewhere. Slowly I started to increase the selling price little by little in stages with the reason that the buying value was increasing.
Consumers are starting to understand the conditions that are happening, they are already used to the new rates. In the end my business started to survive even though the profit was not too big. Whatever you do, you need patience and the latest breakthroughs. When the situation doesn't go as planned, you need to make the right decisions and have the courage to take risks to survive a downturn.