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How to Deal with Setbacks in Your Work at Home Business

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Discouraged girl at computerNo matter how well trained, confident, or otherwise prepared you feel about your small business endeavors, there is one inescapable truth that you must accept: 

You will need to know how to deal with setbacks.

Setbacks are part of the territory as an entrepreneur. (Really, they’re just part of life!) And while you should definitely try to avoid setbacks when possible, it’s equally important to know how to recover when they do happen.

Of course, this is easier said than done at times! 

You might lose a client, or encounter financial roadblocks. Something may even happen in your personal life that affects your ability to work on the business. 

These are just a handful of scenarios. And if you don’t know how to handle them, they can discourage you, stall your progress, or cause you to give up altogether.

Fortunately, there are six strategies you can use to prevent setbacks from becoming a threat to your business or mental well being.

1. Expect failures, even if everything is going well

Nay, especially if things are going well. That way when you hit a speedbump, you aren’t blindsided. 

That’s not to say you should be fearful and paranoid about things going wrong, but you’re accepting of the fact that you and your business aren’t invincible. 

We’re all human, and because of that things will go wrong. Quite often, these instances are outside of our control. 

Failures happen because you’re trying. They happen because you didn’t give up. And that’s a good thing! Accept them as part of the journey and they will sting less when they happen.

2. Acknowledge your role in the setback

Although some setbacks are caused by external forces beyond your control, there are many where you likely played a role. It’s important to accept responsibility and gain perspective on how what you did or didn’t do caused the setback.

Did you take on too much at once?

Did you not put proper administrative procedures in place?

Do your skills leave room for improvement?

Yes, they are hard questions to ask but being able to answer them honestly will make you a better entrepreneur. (Need more tips on becoming a better entrepreneur? Check out our post, 10 Steps to Becoming a Better Entrepreneur!)

Even if the setback was caused by someone who works for you, you need to take responsibility as the head of your business. 

3. Put Remedial Measures in Place

This is the “live and learn” part of the setback. Whether or not the setback was within your control, there is almost always a lesson to be learned. Find out how to prevent that particular setback from happening again. 

If the setback affected your clients, reach out to them to discuss what happened and how you’re going to fix it. It might be a difficult conversation, but it’s important to be open and transparent about problems in order to maintain your integrity and trustworthiness. 

It’s not enough to just fix the problem, but complete recovery means you put measures in place to prevent the setback from happening again. It could mean taking a couple of proverbial steps back and reevaluating your business.

4. Cut Your Losses

One of the worst things you can do is try and hold on to something that isn't working for your business. (This could be the reason for your setback in the first place.) Sometimes referred to as the “sunken cost fallacy”, some entrepreneurs will refuse to cut their losses on a product or service that isn’t working because they’ve already put so much time and money into it. 

But then it just keeps costing more time and money. 

For example, one of my favorite podcasters and entrepreneurs, Pat Flynn, has been brutally honest about the times he’s failed in his business and how he rebounded from them. He once launched a membership group that saw initial success, but he couldn’t keep up with the content demand and people started leaving and complaining that they weren’t getting what they’d thought out of it.

So he ended it, even though it was a lot of work to launch and run it, it wasn’t working for the business so he cut his losses and started over with something that did go on to be a success. 

How to deal with setbacks. Discouraged girl at a computer.5. Focus on the Wins

If you can shift your mindset to change the way you think about setbacks, you’ll have a much easier time coping with them.

Because setbacks are really just experiences that make us more resilient. They allow us to level up in our business in a way we wouldn’t be able to do if we didn’t experience them. 

So use the power of positive thinking to focus on the wins to take the sting out of your setback.

For example, perhaps your pitch for a gig you really wanted got rejected. You can still consider the experience a win because it was good practice for the next pitch, which will surely be better. 

And before you say there are no wins in your situation, know that there always is, even if it is very small – Even if that win is just that you did not give up

6. Take a break

Remember that taking a brief hiatus from your business doesn’t mean you’re quitting or giving up. But sometimes you need to take a few days to lick your wounds before getting back in the ring. 

Taking a break when you need one is crucial to avoiding burnout. But the key to a successful break is to decide in advance how long you will take away from your business, whether it’s one day or one week. That way, you can fully recharge during those days guilt-free without feeling like you’ve given up because you have already decided when you will get back to work. 


Setbacks can be a hit to your confidence and enthusiasm (not to mention your ego!) but they don’t have to hold power over you or your business. By understanding that setbacks are a normal part of being an entrepreneur, you’ll be able to utilize these coping strategies to bounce back with gusto and continue on to find success!

Do you have experience with how to deal with setbacks in your business? If so, how did you overcome them? Let’s share our experiences in the comments!

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