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your-business-in-dark

5 INDICATIONS THAT YOUR BUSINESS IS IN DARK.

According to the Small Business Association (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’s too late.

So what are the common signs a business is in trouble?

CASH SHORTFALL

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’s 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.

You’d be surprised how often a company doesn’t actually know whether it’s 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 apply for a small business loan and look into invoice factoring to account for those late payments.

THE BEST EMPLOYEES ARE LEAVING

One of THE biggest warning signs your company is in trouble is when your employees are running for the hills. 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):

  • It may indicate an inability to pay talent at the market rate
  • It could mean that higher management is unable to uphold an attractive and fun work environment.

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.

MARKET SHARE LOSSES

A report by the Society of Practitioners of Insolvency in the UK found that loss of market share 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.

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.

CUSTOMER RETENTION IS FALLING

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.

  • A fall in customer retention could be due to a number of factors including;
  • Failing to meet customer expectations
  • Customers are finding better deals elsewhere
  • Poor customer service
  • Your product or service is no longer relevant

YOUR BUSINESS IS RUNNING WITHOUT SAP

SAP Business One is an enterprise-ready software that binds all the processes of a company together. So you don’t have to use one software for accounting, another for resource planning, something different for HR and so on. Instead, you have one single software that manages all the aspects of your business. This ensures a smooth workflow, quick decision making and minimal back and forth.

  • SAP ERP software is a centralized enterprise management system.
  • The centralized system removes the duplication, gaps, and redundancy in data.
  • It provides information across all departments in real time.
  • SAP ERP system provides control on different business processes.
  • The centralized system enhances productivity, provides better inventory management, endorses quality, decreases raw material cost, effective HR management, reduce expenses and enhances profits.
  • With a centralised system, the organisation can get better customer communication and thus improves throughput. It also helps to enhance customer service.

About the author

MegathermERP is an Authorised SAP Business one partner in Kolkata, India. We offer complete ERP solution in eastern Indiaincluding Kolkata, Odisha, Bihar, Jharkhand, Assam and Raipur-Chattishgarh. It is the focus point of our business that we help our customer achieve a robust IT infrastructure so that they can concentrate in their core business without having sleepless nights concerned about IT.

Call our help desk to know more or visit our website www.megathermerp.co.in

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