It can be scary to have your own business. In the grand scheme of things, only a handful of new businesses make it past a year, and after that, not everyone can last up to 5, 10, or 15 years. Whatever your field or industry is, it takes guts, strategy, and hard work to make it. One of the ways you can protect your business and keep it running is by being self-aware and alert.
Before any business fails, there will be warning signs. These signs won’t always have an easy solution. But so long as you have the patience and understanding to solve them, your business can not only survive but will also thrive.
Today, let’s look at some of the top warning signs you should look out for. Here’s what you need to know:
High Staff Turnover Rate
A high staff turnover means you do not have a good team. If your employees are quitting, or even worse, getting fired for poor performance, you don’t have a good team.
You may find yourself surrounded by underperforming people or a mixture of good and mediocre people. Either way, your company needs a better team. The costs of advertising, hiring and training, can quickly add up. So, it is essential to realise straight away if your business has a high turnover rate so you can change your management style or change how your run your business. You should always follow the basic rule – hire slowly, fire quickly. Take your time to ensure that the person you are hiring will be a good fit, not only to fit your culture but someone who will add value to your existing team.
A business with low morale may be dysfunctional. Low morale can lead to poor employee performance, high turnover, and even total business failure. If you find yourself in a situation where employees are not happy with the way things are being run, you need to evaluate how you manage your team.
If you can’t figure out what’s wrong with your management style, you should consider hiring a professional to help you out. A professional can understand your business better and guide you to make the right changes to your management style and processes.
Our team works closely with a group of HR professionals who can help with your team’s morale and employee satisfaction levels. Simple things like having a daily huddle, regular meetings and regular relevant training can all lead to high-performing teams. Contact us to learn more about how we can help make your team a high-performing team.
If you find yourself going further and further into debt without any sort of recovery, eventually, your business will fail. To keep your business afloat, you need to keep your finances healthy. If your company faces financial troubles, try to become more efficient and cut unnecessary spending.
Your business should be making money after all, that is why you went into business in the first place. If you’re unsure where you are losing money, talk to a team of accounting experts and business growth mentors who can help you today, before anything gets worse (03) 9374 8400. We will help you analyse where the leakage might be coming from. Sometimes, it is as simple as understanding your Profit & Loss report and also analysing the margins on your sales. Don’t wait until it is too late.
A business with poor profits does not make sense. Without profits, you can’t continue to fund your business. If your business is not making any money, you will find yourself unable to pay your employees, and you will end up going on a downward financial spiral. This will not only have an effect on how you run your business but may flow down to low enthusiasm from your team.
If you find your business is in the red, think about why this is happening. Look into why your customers aren’t buying from you or why you cannot make as much money as you should. The underlying cause should be addressed and solved. Otherwise, there will be no long-term success for your business. You might need to engage in some good marketing strategies or when we are faced with rising inflation, you might even need to review your pricing. When was the last time you did that?
However, the underlying cause can be difficult to pinpoint. Without proper accounting and bookkeeping practices, finding this underlying cause can almost be impossible. By working closely with a professional team of award-winning accountants from day one you can ensure your business’s financials are always up to date and assist you in making informed decisions that work in the best interests of the business. Talk to our team of accountants today to truly understand your business’s financials. Good records allow you to measure your performance. You should remember this one sentence. If you cannot measure it, then you cannot manage it!!!
Poor Customer Service
The customer is always right, and that is the truth in the world of business. If your customers are not happy and you do not take the time to listen to them, you are leading yourself down a road of a business failure. If you are getting bad reviews and complaints, you need to address the root cause and fix it. Your customer service is vital to either bringing in new customers or turning away existing customers. Good customer service can often lead to more referrals, so practice great service!
Your team needs to be trained – in many cases, your team is the forefront of your business – quite often, they are the first person your customers see. You want this to be a very pleasant experience and you want your customers to become raving fans. Raving fans lead to rising profits.
The Bottom Line
The world of business can be hard. In order to make it, you need to be self-aware and alert. If you are experiencing any of these warning signs, take a good hard look at your business and evaluate what you can do to make it better. If you want your business to thrive today, then you need to take action and make the right changes. Start with the low-hanging fruit. Let us help you find and understand the root causes.
Take your business to the next level by contacting our team today. Budgeting and forecasting can be the single most important thing you do and can require a lot of work and effort on your part. If you need some assistance and guidance, let us help you. MKS Group has some of the best cloud accountants in Australia! We provide the best solutions to all of our clients. Contact us today to get your finances sorted.
(03) 9374 8400