It is difficult to admit that the business in which one has invested so much time and money might be in trouble. It is said that the average entrepreneur fails 3 times before they succeed in business, so knowing when to stay and bat it out and when to cut your losses and move on is a difficult thing. A successful formula is a mixture of several things and if the combination is off, you might be best looking for another opportunity. Not all failures come out of nowhere but these 7 tell-tale signs your business is in trouble can warn you that your business could be balancing on the cusp of a potential failure and it might be time to move on. Nobody will condemn you because your business didn’t pan out, so it doesn’t make sense to beat a dead horse, persisting in running a failing business simply because you are hopeful that things will work out.
Here are a few signs your business is in trouble which might help you realise it’s time to shake up the formula and try a fresh approach, or a new business venture or your next project.
1. You haven’t spoken to a potential customer in over a month.
As a business owner, you should be speaking to new customers consistently the more they have contact with you, the more chances there are to make a sale. If this is not the case, then either your company is not competing well in your industry, or your employees (or you) are not living up to expectation. Whatever the case may be, you will need to ensure you keep in contact with customers and this may require you to make fundamental changes in your business process to ensure this is an ongoing task.
2. You keep making the same mistakes.
Although business owners don’t do this intentionally, repeating the same mistakes over and again without changing the way you do things is a sure-fire way to fail. After seemingly tackling a problem, it still resurfaces again, then you must change the way you respond, in order to get a different result. If you cannot figure out why the same mistake is reoccurring repeatedly, it is an indication that your business is waning and you will need a second opinion for a fresh perspective.
3. Bills are not paid on time.
A thriving company should be able to live up to its financial responsibilities on schedule. However, if you are not able to settle your bills on time, then something is wrong. It is a serious development, and you must stay on top of this and resolve it as soon as possible. You cannot survive for long if you cannot meet your obligations. A short-term shortage of funds is acceptable but it begins to drag on long term, it might be worth taking a look at your business processes and see where you can cut costs.
4. The business is at a standstill without any progress for months
This indicator may not be obvious to a CEO right away, but a business must progress, grow customers or develop new products or services. A business may be on its way out if there is no change in business over the last year. Thriving companies still need to innovate and make changes to remain relevant in their industry and as the business owner, this falls to you to ensure you are evolving. It is bad for business when a company becomes complacent as it cannot compete with its competitors in the marketplace.
5. You have a low employee retention rate.
People are always wary of dealing with businesses who have a high staff turnover. This is usually a sign that management is dysfunctional, the pay is low or the employees are generally unhappy there. This sends a message to your customers that they may not be dealing with an honorable company. If you do not take the time to hire staff who have the correct qualifications and treat them well on the job, the retention rates of employees will be very low.
You will simply find yourself in a repeated cycle of interviewing and training new employees which is a cost that many businesses need not bear. This can become a nasty cycle and a clear indicator that your business is sick.
Take time to nurture your employees and keep the morale high.
6. No one is talking about your business.
If your business is not garnering reviews and word of mouth referrals, the community might be oblivious to the existence of your business. For a business owner, you need people to be talking about your business. Ensure your friends and family are mentioning your products and services and that your business is appearing in your community resources. This could be a matter of some advertising, or getting your website optimized for search engines.
7. Others are noticing that the company not striving
If people other than yourself, or your employees notice that your business is not doing well, then you need to take immediate action.
These 7 tell-tale signs that your business may be failing are a guide to help you take a look at your processes and strive for a better outcome. Get those nails out of your coffin and keep your finger on the pulse of your business.