Recently we tipped you of the top ten indicators to show that your business is on the right track to success. In this article we highlight the top ten indicators that show that your business is on the collapse trend and should get you worried. Read on.
- You’re not making a profit
It’s easy to say that you have to make money, but in reality that isn’t true. You need to be making a profit. Bringing in a million shillings a month is useless if you are spending a hundred million. That means you would be losing ninety-nine million shillings every month.
Successful businesses make profit. And although you may not be profitable right now, you have to work towards it. 1 in 2 Ugandan businesses fail A respected New York Times articles explains that the number one reason is this:
Not enough demand. This results in your revenue not being enough to cover your costs and hence a loss.
- People don’t talk about your company
Word of mouth marketing is the best way to grow your business. If no one is talking about your company, then you aren’t doing a great job.
Advertising and paid marketing are great, but the organic stuff is what really helps a business grow. For example, people use Google because they heard about it from someone else. Since Google first came out, it never paid for advertising.
- You’re on your first business
If running your first business, then unfortunately the odds are not in your favour. You’re likely to fumble a lot. 78% of first-time entrepreneurs fail. The odds just aren’t with you because you are stepping into a new territory.
And even if you are on your second business, your odds don’t increase drastically. Instead of having a 22% chance of succeeding, you’ll have a 34% chance of succeeding. Hopefully just knowing the high failure rate means that you will take success seriously.
- You can’t focus
It’s better to do one thing really well instead of doing a hundred things at a mediocre level. Google, Amazon, Microsoft and Skype, are just a few examples of companies that did one thing really well.
Yes, later on they did start expanding their businesses, but, at first, they focused on mastering that one thing that set them apart from others.
- You hate taking risks
Sometimes you just have to roll the dice and take risks. Playing things conservatively doesn’t always work. Switching up business models, laying off a whole department, or even moving your company location are just a few risky things that you may have to do.
It’s too hard to predict what these risks will be for you, but when the time comes, you have to be willing to take them.
- You hate to delegate
If you try to do everything yourself, you’ll be limiting the true potential of your business. If you can’t trust your team to help out, then things will never get done quickly.
Plus, it doesn’t matter how smart you are, not one can be a master of everything or as they say, a jack of all trades. You might as well delegate tasks to people who are better at doing them than you are – let people play to their strengths. If you don’t know how to delegate, read this.
- You don’t care about your customers
Customer service and support is something that can make or break your company. If you don’t care about your customers, they won’t come back and buy from you again. Remember, it’s typically easier to get repeat customers than new customers.
The 80/20 rule is that 80% of business comes from 20% of clients – who are usually repeat customers!
- Projects or services are delayed
A tell tale sign of a business that does not do well is when deadlines are breached, it never handles projects on time etc. What this means is that behind closed doors you often have a team who do not know what they are doing, have no systems in place and so when a customer comes, everyone is running around like a headless chicken!
Put in place systems and procedures (written) and follow them so that the business can run, regardless of who is running it.
- Employee turnover is high
Are your co-workers or staff dropping like flies? That could be a sign of poor management, salary, and benefits and hence a poorly run company that doesn’t value its staff.
- Salary increases are a distant memory
Businesses need to invest in talent, and happy employees are a significant part of a sustainable organization. If you employee salaries are not raised for a long time, then that is a sign of a company with cash flow difficulties – and hence the best talent will leave and go somewhere else where they are rewarded.