Unfortunately, there is no way to train yourself on how to run a business. Therefore, most business owners use the ‘sink or swim’ methodology. This is why a lot of small businesses fail in the first year. Most are gone by year five, and the rest usually start to stagnate by the seventh year.
Ten Signs that your business is in trouble.
- You are spending too much time dealing with minor problems.
You can’t run a business while you are forever fighting fires. If you find you are spending too much dealing with time-consuming issues, it’s emblematic of a much bigger problem that’s lurking in the wings.
- Your bank account(s) are always hovering on empty.
If your bank accounts are zero or you are getting NSF fees, then your business is riding on the wave of failure. At some time that wave is going to hit the shore leaving you high and dry. How much you have in reserve depends upon the type of business, but a good start is to maintain 10% of your estimated annual revenue in your bank accounts.
- You delay paying bills beyond 30 days.
In today’s business world, all bills should be paid within 10 to 20 days, even sooner. Keeping money in your account instead of paying bills is an antiquated practice that has no place in today’s business circles.
- Some of your suppliers want to be paid before delivery.
Your suppliers are not there to finance your business. If they suspect your business is in trouble, they will pull back. The fact that your suppliers know your business is in trouble while you are in denial is an important indicator that your business in deep trouble.
- Large customers will delay paying you.
When customers delay paying you, it is because they – like your suppliers – already know your business is in trouble. Now you might wonder why, since their payments could help you sort out your problems. The reason they hold back is simple – if your business collapses, then they don’t have to pay you.
- You ignore calls from creditors, your bank of from the tax department.
If you ignore these calls, your creditors will fear the worst, and then they will make things even worse. Take these calls and be honest. There is never a good time to BS, but this is definitely not the time to start. Understandably, you are reluctant to take these calls but they serve a very important purpose – they prove to your creditors you are not hiding. Never ignore these calls. Here’s a HINT! If for some legitimate reason you can’t take the call, DO NOT wait for them to call again. You must call back at the earliest moment.
- You start blaming people for not doing their job.
The moment you start blaming other people, your business is on the verge of collapse because you have just surrendered all control of your business.
- You start to take your problems home with you.
Business is business, so never take your problems home otherwise you may lose more than your business. You don’t need to put on a rose coloured show. Your family will already know things are not good so talk about your concerns – not your problems.
- You think a loan will solve your problems.
Unless the main problem has been identified and corrected, only a fool would exchange one debt for another debt. The Banks know this and this is why they will not lend you any money.
- We saved this for last. The worst mistake you can make is to NOT ask for help.
Too many business owners believe it’s just a temporary problem that will fix itself. Problems DO NOT Fix themselves!
You’ve invested too much in your business to lose it because you were too proud to ask for help. Call us sooner than later, and definitely do it before it’s too late.