Five ways on how to know if your business is on its deathbed
6 months ago, 31 Dec 13:01
Sheba Njagi, the CEO of Roarke and Bartley- a wealth creation trainer and speaker at Centonomy Limited- explains how to determine if your business is failing and how to transition back to employment. 1. Gather intelligence Direct the right questions to your clients. What do they feel about the service or product that you are giving to them? Are they content? Would they go elsewhere for that service or good?After analysing the responses, you will know if your business is failing or not. Sometimes you might have had a good idea and you felt that there was a gap in the market for it but as soon as you bring it to the market, you get feedback that people are not interested in it. Oftentimes entrepreneurs wait to do this until it is too late, after they have poured so much money into a sinking pit. 2. Cash flow is key What are your finances saying? Cash flow issues are always a good indicator of whether your business is failing. Is your business making a profit? How far is it from breaking even? Are the expenses way higher than the proceeds? Debt is usually a key expense but your business could be in so much debt that you are not even able to meet your debt payments and your business can barely stay afloat. Cash flow is a key performance indicator. Being able to track your expenses and income gives you a clear picture of the performance of your business. Many entrepreneurs focus very much on bringing the product out to the customers and selling and forget the bookkeeping and accounting aspect of the business. It reaches a point where money is coming in but you really do not know how the business is performing, until it is too late. 3. Poor marketing strategy If your marketing is poor, your business is failing. You can have good products or good service but if it is not well marketed, it means it is not being bought. Marketing is usually left until the last minute and is rarely included in capital injection. This is setting yourself up for failure. If you are already marketing, determine whether your strategy is helping the business. 4. Poor team relations You may have co-founders but you feel like you are doing all the work and they are not doing what they are supposed to be doing. That is a recipe for disaster. Many people who are friends or colleagues decide to start something together but start falling out in the business front. As soon as you start seeing that the relationship from a business stand point is not working out, then know that problems abound. If this is not resolved, it could spell doom for the business. In addition to that, access your staff, whether full-time or part-time. How are they performing in the business? Have a way to track their performance and mend any tears. 5. Evolving nature of the industry The changing economic times ...
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