While it might be tempting to just give up when your business is teetering on the edge of collapse, putting in the effort to turn things around is not only financially rewarding but can also be personally satisfying. Of course, each situation is different but there are some basic strategies you can take to turn the situation around and ensure it doesn’t happen again. So what are the steps to turning around a failing company?

First of all, you need to identify the problem. While this may sound obvious, the root cause of your difficulties may not be what you initially suppose so dig deep into your data and maybe get some help from your accountant who can help you make sense of the numbers.

Develop a recovery plan and make sure your goals are SMART, i.e. Specific, Measurable, Attainable, Realistic and Timely. Tackle individual issues in order of importance – the most urgent problems need to be addressed first, even if they are the most unpleasant.

You don’t need to do it alone and, in fact, sometimes it won’t be possible so build a support team to help you. They don’t have to be people within the business; your business advisor, bank manager and/or lawyer can also help with advice and a different perspective on how to tackle the issues.

Get your employees on board as soon as possible. They will probably already know or suspect something is wrong so call a company-wide meeting to let them know your recovery plan. You will need their support for the plan to succeed so this step can’t be avoided.

Just as it’s important for your employees to be kept informed, you also need to let your customers and/or business partners know what’s happening. While they don’t necessarily require all of the details, it’s essential to be honest about the circumstances and let them know you have plans in place to rectify the situation. They may even be able to help you with your recovery plan as it’s within their best interests for your business to succeed.

Finally, it’s vital to contact the tax office and your bank to let them know of your difficulties so that you can arrange a payment plan if you are unable to meet your tax and/or financial obligations. It’s necessary you do this sooner rather than later – ignoring the problem won’t make it go away.

Once you have your recovery plan in place, you’ll soon see the light at the end of the tunnel. Being open and honest with all of the stakeholders involved, taking any necessary action and having a support team to help will get your business back on track in no time. The most important thing is to learn from your mistakes so that hopefully you don’t have to go through the same process again in the future.