{"id":3059,"date":"2018-10-02T17:54:30","date_gmt":"2018-10-02T14:54:30","guid":{"rendered":"https:\/\/www.lending-express.com\/blog\/?p=3059"},"modified":"2019-12-18T10:40:08","modified_gmt":"2019-12-18T08:40:08","slug":"5-warning-signs-your-business-is-in-trouble-and-what-to-do-about-it","status":"publish","type":"post","link":"https:\/\/www.become.co\/blog\/5-warning-signs-your-business-is-in-trouble-and-what-to-do-about-it\/","title":{"rendered":"The 5 Warning Signs That Your Business Is in Trouble"},"content":{"rendered":"

Has your business lost its mojo?<\/span><\/p>\n<\/p>\n

Just like every normal relationship has its good days and its bad days, businesses are the very same. Every business goes through its ups and downs, the problem arises when the \u2018downs\u2019 don\u2019t seem to be budge.<\/span><\/p>\n<\/p>\n

Here we\u2019ll take you through the tale-tale signs a business is in trouble and more importantly, how to stop the downward spiral in its tracks.<\/span><\/p>\n<\/p>\n

Businesses come and go<\/span><\/h2>\n<\/p>\n

According to the <\/span>Small Business Association <\/span><\/a>(SBA), 30% of new businesses fail during the very first two years, and if you fast forward to the 5-year mark that percentage increases to a whopping 50%! If you can spot the warning signs your company is in trouble, you may just be able to save it before it\u2019s too late. <\/span>
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\n<\/span>So what are the common signs a business is in trouble? You\u2019re about to find out. Moreover, if you recognize any of these signs in your business, it could be just a temporary setback or it could indicate a more serious issue beginning to show its nasty head – better to nip it in the bud than to sit back and let it fester. <\/span><\/p>\n<\/p>\n

1. Cash shortfall<\/span><\/h2>\n<\/p>\n

One of the undeniable signs a company is in trouble is dwindling cash flow. Seeing as cash flow is the number one reason that most businesses fail – if your company is in a cash crunch, it\u2019s time to re-evaluate. The ability to generate a consistent and hopefully, increasing cash flow is essential to business success. A negative cash flow (unless you have a seasonal business where fluctuations are the norm), is a clear indicator that a business is experiencing financial difficulty.<\/span>
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\n<\/span>Pro tip: <\/b>Take a look at your company\u2019s balance sheet regularly and make comparisons between the current cash holdings, versus what they were this time last year to get a clear indication of the facts. On top of that, there are plenty of tried and tested ways to <\/span>manage cash flow <\/span><\/a>and maintain a healthy business. <\/span>
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\n<\/span>You\u2019d be surprised how often a company doesn\u2019t actually know whether it\u2019s making or losing money! With so many expenses flying out the door, having a professional accountant that keeps meticulous records is key in preventing any nasty surprises down the road. If cash flow is one of the main issues due to delays in payment it may be best to <\/span>apply for a small business loan<\/span><\/a> and look into invoice factoring to account for those late payments. <\/span><\/p>\n<\/p>\n

2. The best employees are leaving<\/span><\/h2>\n

One of THE biggest warning signs your company is in trouble is when your employees are running for the hills.<\/p>\n

Unmotivated employees or worse, depressed employees are a sure indicator of struggling businesses. If employees are unhappy in the workplace this could be a sign of one of two things (or both):<\/span><\/p>\n

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  1. \n
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    1. It may indicate an inability to pay talent at the market rate<\/span><\/li>\n
    2. It could mean that higher management is unable to uphold an attractive and fun work environment<\/span><\/li>\n<\/ol>\n<\/li>\n<\/ol>\n

      With the drive and fun being sucked out of a company, employees will surely begin to despise being at work, which is never fun. The best employees leaving, therefore, is a sure sign that the company is in trouble. <\/span><\/p>\n<\/p>\n

      3. Market share losses<\/span><\/h2>\n<\/p>\n

      A report by the Society of Practitioners of Insolvency in the UK found that <\/span>loss of market share<\/span><\/a> accounted for around half of all company failures in a study involving 1,900 companies that went bust, meaning that market share, is key to profitability. <\/span>
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      \n<\/span>Losing market share can often indicate an inability to compete in the marketplace and is a sure warning sign a company is in trouble indicating that future financial pressures are around the corner. <\/span>
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      4. Customer retention is falling<\/span><\/h2>\n<\/p>\n

      If you are losing customers by the day, and especially if you are losing more customers than you are gaining, then it is only a matter of time before you see a drastic drop in revenue. This is a sure warning sign your company is in trouble.<\/span><\/p>\n<\/p>\n

      A fall in customer retention could be due to a number of factors including;<\/span><\/p>\n