How Long in Years Should I Wait Before I Close Down an Unprofitable Business

[MiF]

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."

- To what extent do you agree or disagree with this assertion ?

-Have you had a business that even though it wasn't profitable in the first three (3) years, then it  kicked off to bring in good returns in the fourth (4th) year?

1 https://www.instagram.com/reel/CqVbhNCt0yF/?igshid=YmMyMTA2M2Y=

For me i think 3 years is a perfect time to close unprofitable business because if you don't close your unprofitable business it will surely make your capital loss because there is always a big expenses on making business specially eatery business, you need to pay electricity, water bill, etc., So in 3 years if business doesn't work we need to close it.

[fuer44]

If the business doesn't generate profit for less than 2 years, we can't run it anymore because the capital used has run out. Especially if the business is on a farm or plantation which is a living creature whose food intake cannot be delayed. Maybe if the business is in property, the longer it will be the more profitable it will be because it will be more expensive. For goods or electronics business, while it hasn't expired I think 1-2 years waiting to get profit is normal.

[lienfaye]

How long in years should I go before I give up and close down a business that is unprofitable?

Depends on how long you can take the situation of not gaining from your business. Ask yourself if you already did your best? Maybe you're lacking something. Because before we decided to closed down, usually we're coming up first for a plan to gain the trust of our customers again, improve the business and be more competitive.

I also have a business and just like others, we've been through as well the struggles of losing our customers due to many competitors. For me, I think a year would be enough to say if you're going to continue running your business or stop it. Because if it's not profitable anymore, there's no reason already to continue the business.

[Issa56]

If a business is unsuccessfully, then you should check where you have gotten it wrong, if other people running the same business are making money, then you should check where you have gotten it wrong and fix yourself. I don't believe their is anything like failed business or unprofitable business, if you are not making money in a business, then you should check your business strategy, your marketing and your location. Some people locate their business in a location that there service is not needed, and some people don't do proper marketing in a business.

[wiss19]

3 years of waiting is a bit long. I think it will only cause more problems to you so I think the advice isn't really good to follow. For me I think the ideal time of waiting is a month or two. This must be long enough already to know if there is still a sign that your business is going to survive or not. Not only money that we can waste if we wait longer if there is no improvement but also time. If only we can move on to other fields, maybe we can find our luck there and we can recover our previous losses in no time.

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."

- To what extent do you agree or disagree with this assertion ?

I think I can both disagree and agree. Disagree because, the idea of trying is also correct but if the situation is still the same, that is how the statement becomes right. Maybe it was really put there for us to avoid.

[Yatsan]

You don't need to wait for years; you'd know for a few months whether you should continue or not. If most of the time no profit is being generated and worse, losses, are the only outcome; try making a change with your plans or business itself to somehow aid the situation and if it still does not work, then that would be the time to somehow calibrate what you are doing. In a business, there are many factors to consider such as the season, target audience, costing and more. Try atleast managing each of this factors to somehow cope up with downward performance. But unfortunately, there are really businesses which do not work as expected and times wherein trying other business would be better.

If a business is unsuccessfully, then you should check where you have gotten it wrong, if other people running the same business are making money, then you should check where you have gotten it wrong and fix yourself. I don't believe their is anything like failed business or unprofitable business, if you are not making money in a business, then you should check your business strategy, your marketing and your location. Some people locate their business in a location that there service is not needed, and some people don't do proper marketing in a business.

This is what's ideal but reality check; not all business owner has the capability to extend that much to save a business, financially. Pushing it through won't do you good but if your really believe that things may still work for a long run, you are free to continue just be cautious of the worse possible scenario to happen to prepare yourself and to save you afterwards.

[Mate2237]

From the business perspective, five years is stipulated to gave up a business that is not productive. Any business that survive well after five years will not die again. Because the sustainability duration of a business is five years. Within this five years period you are to check and balance the weaknesses and the strength of the business. Three years are short to know the weaknesses and strength of a business, the first is for advertisement of the business then the second year is for customers awareness services where you also make some promo to lure customers to come and the third year is for expansion of the business then the fourth year is to cross check your progression then the fifth year is to know whether you are progressing or not if you are progressing then you have to close down the business because you have spent five good years in the business and no improvement then you have to diversify you capital to start up another business that would give you profit.

There are different factors that you have to check before you start a business. One of the factors is the encouragement, which is comprises of the population of the area then another thing you to look into is the number of people that doing that the same business in the place and their price differences. Note these before starting up a business.

[Outhue]

I've run a business for four years and I decided to shut it all down, the biggest decision I've made so far when it comes to business, sales were very bad and I couldn't cope anymore, I got frustrated and I decide to go for fashion designer, all this while I was already eyeing Bitcoin investment, doing research whenever I am less busy, I made the right choice leaving the old business and I've never regretted leaving,  some times you have to find your path and if you are not scared of any challenges you will find your way in the end, there is no way to tell that you are going for a bad business experience until you do it, striving is the smoothest way to success, you will only know what is waiting for you at the end of a tunnel if you try.

[Mpamaegbu]

- To what extent do you agree or disagree with this assertion?

I disagree with him on the three years wait. I would shoot the business down if it went on a year without being productive. The only way I would leave it to that point of three years would be if the business started and then went on lock and key, only to be reopened again on the third year. Otherwise, why would I be feeding a business that isn't making me any profit for three years. Doing that isn't a good business strategy.

[davis196]

- To what extent do you agree or disagree with this assertion ?

-Have you had a business that even though it wasn't profitable in the first three (3) years, then it  kicked off to bring in good returns in the fourth (4th) year?

I've never had to run a business in my life. I'm not a business oriented person. Having a business requires so much more effort and good social skills.
I completely agree with Kevin O'Neal. Some businesses become profitable in the first year, while others take several years before they start making a profit. It depends on the industry and the market niche. Trying to keep a losing business for way too long is wrong move. It will get the business owner into more debt and more trouble.
There's a theory called the ""sunk cost fallacy", which explain why many people don't want to give up on certain activities in their life, mostly because they have invested so much time, efforts and money. Giving up would mean that all the efforts and money invested were simply wasted and that's why so many people don't want to give up and move on.

[passwordnow]

3 years is too long for me but that would be enough to think about what you're doing. I think a year is already fine to determine whether to pursue a business that's not profitable. But I could also be wrong because we've got our own timelines. Some may be good seeing them fail within 6 months and they're already out. And that range is also undeniable enough to say to give up a business because if you're the sole financier and you own it, you'll have to think about expenses and no cash flow getting into you. If you think that you can have that no cash flow and all you've been spending for the operation is coming from your pocket, that's okay as long as you can sustain and you believe on what you does.

[soramon]

Well i never run a business but maybe i understand a little bit about business. I never seen someone who run a business for the first time and succeded. So, if your business not giving you profit maybe you need to analyze it. Find the problem then take a good approach to solve it. Or, maybe you try new one.

[GiftedMAN]

- To what extent do you agree or disagree with this assertion?

I disagree with him on the three years wait. I would shoot the business down if it went on a year without being productive. The only way I would leave it to that point of three years would be if the business started and then went on lock and key, only to be reopened again on the third year. Otherwise, why would I be feeding a business that isn't making me any profit for three years. Doing that isn't a good business strategy.

I agree with you, there's no way I will keep investing in a business when am not making profit from the business even after three years that's crazy you know?  Six months is ok to be patient with unproductive business because this time, you will have gained more knowledge on how to push the business going and as someone who may be new in the business, you can take this time to advertise and gather more customers but keeping a business that isn't bringing profit for you for three years is a waste of time and resources and locking up and reopening the business in that same shop and location means you took time off to change the items you sell otherwise you aren't doing the business any good by reopening it again.

The main aim of setting up a business is to maximize profit and if the goal is not been achieved I would suggest that you shoot down the business and invest in something else unless you aren't ready to get returns as the case may be.

[AnonBitCoiner]

Yes it's true that if a person don't get what he wants in business for long time then stopping such business will be better because if you are facing losses regularly then a time comes when you want to get rid of such business.

At start you will face problems and losses because of little experience but after two or three years your chances of losing money become reduce. When talking about crypto investment then there is no guarantee about its better outcomes so tolerating during down price will be profitable but you should invest in that coin which has lower chances of losing money.

The duration of tolerating losses depend on the sort of business like that of cryptocurrency in which you will face losses but you can recover all you losses when the market goes pump again.

[slapper]

From the business perspective, five years is stipulated to gave up a business that is not productive. Any business that survive well after five years will not die again. Because the sustainability duration of a business is five years. Within this five years period you are to check and balance the weaknesses and the strength of the business. Three years are short to know the weaknesses and strength of a business, the first is for advertisement of the business then the second year is for customers awareness services where you also make some promo to lure customers to come and the third year is for expansion of the business then the fourth year is to cross check your progression then the fifth year is to know whether you are progressing or not if you are progressing then you have to close down the business because you have spent five good years in the business and no improvement then you have to diversify you capital to start up another business that would give you profit.

There are different factors that you have to check before you start a business. One of the factors is the encouragement, which is comprises of the population of the area then another thing you to look into is the number of people that doing that the same business in the place and their price differences. Note these before starting up a business.

Optimal business longevity is five years. Who would have guessed? But what if we extended this reasoning to other spheres? Things like couples or diet plans. Would we still be together after five years if we stopped drinking kale smoothies? Most likely, no.

Let's get down to business, though. Population and encouragement are two considerations when launching a company. Should we thus just take a headcount and cross our fingers? Alternatively, we may enter a market with only one other rival and set our prices three times as high. Genius!

However, the five-year guideline must not be forgotten. If we are not turning a profit by the fifth year, we should abandon the project and move on. Who needs grit and effort when you've got a magic square root?

[CageMabok]

Well i never run a business but maybe i understand a little bit about business. I never seen someone who run a business for the first time and succeded. So, if your business not giving you profit maybe you need to analyze it. Find the problem then take a good approach to solve it. Or, maybe you try new one.

Trying a new one is the same as changing an old business to a new one and it requires more capital and time. I agree more if someone who is already running a business makes an analysis and finds the problem if the business he is running is not progressing, because usually these businessmen always start the business they are most good at first before trying a new business at a later stage if the first business is not progressing.

[mvdheuvel1983]

I don't think anyone can or should decide when to shut down an unprofitable business. It's yours and the decision lies solely with the entrepreneur. It you think your business isn't profitable, try a different approach, a different strategy, a different product or service. Do it until you discover what works and what doesn't. Besides there are a lot of reasons why businesses fail. Unfavorable government policies towards businesses may cause a business to fail, will you tend in turn say it is your hobby? No. So, nobody should be pressured by Kelvin. He doesn't know it all.

[Finestream]

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."

- To what extent do you agree or disagree with this assertion ?

-Have you had a business that even though it wasn't profitable in the first three (3) years, then it  kicked off to bring in good returns in the fourth (4th) year?

1 https://www.instagram.com/reel/CqVbhNCt0yF/?igshid=YmMyMTA2M2Y=

I have not been to any kind of business like that before, but if I observe any business after a year without no profit, I need to quit and find another alternative thing to do. I don't think there is anytime to waste with any business that is not bring profit between a year. But in some cases I may change the business strategy if truly I believe much in the business but despite this reason of change the business strategy, I can't still be waiting for four years to think that the business may turn around.

Three to four years of business without profiting is already long enough. You should have decided that time whether to pursue it or just stop right there. For me, I would rather stop the business and just accept the reality that it’s not going to work anymore. But this does not mean that I’m not going to do business anymore. I will just take a break for a while and then come back to the market with a new in demand business, and certainly with a different working strategy.

[livingfree]

Well i never run a business but maybe i understand a little bit about business. I never seen someone who run a business for the first time and succeded. So, if your business not giving you profit maybe you need to analyze it. Find the problem then take a good approach to solve it. Or, maybe you try new one.

I've seen some. It's quite rare but it does happens that someone who's new to the business and it's not luck that made these people successful with their very first try.

On those businessmen that are not profiting within years and thinking of quiting, that's a good reasoning that there should be something they're must accept to keep going and that is to think that they're doing a hobby instead of a business.

Just set a period of time but 3 years is too much commitment and if that's the actual commitment a businessman can give to his failing business, he sees something that we can't see and that's totally fine.

[Baoo]

I don't think anyone can or should decide when to shut down an unprofitable business. It's yours and the decision lies solely with the entrepreneur. It you think your business isn't profitable, try a different approach, a different strategy, a different product or service. Do it until you discover what works and what doesn't. Besides there are a lot of reasons why businesses fail. Unfavorable government policies towards businesses may cause a business to fail, will you tend in turn say it is your hobby? No. So, nobody should be pressured by Kelvin. He doesn't know it all.

I totally agree, in the end it is up to you to decide the best option to do. Plus, there is no need to keep an unprofitable  business for years. That’s waste of time without benefits. Furthermore, I see a lot of entrepreneurs who don’t give a value to digital marketing. It is really important and necessary nowadays, without it your business will never grow. Your main goal is to build attention, it helps to attract clients , partners sponsors and companies. Nobody will notice your business , if it does not show up in social media.

In fact, it is essential to make different strategies and plans. The more you have, the more solutions you will find. Also the added value is important. What makes your business better and more unique than the others? These are the keys to make your project successful.