When a business is about to fail the worst part of the failing business is that the entrepreneur is unaware of it happening until it is often too late. The question is, does the entrepreneur knew what he was doing wrong? Because if he does, he might have been able to save the business. Some entrepreneurs live in a land of denial while others are unaware of their mistakes.
Report from the Corporate Affairs Commission (CAC) has it that over 1.271 million companies are confirmed registered. And that is an impressive number.
But in reality, research has shown that only half of new businesses survive for the first five years and only one-third of new businesses are able to survive for 10 years or more. Also, Forbes reports an even more grim statistic, based on Bloomberg research, that of every 10 businesses, eight fail within the first 18 months.
It is never easy to run a business because you have to give up a lot of things to ensure its smooth running. There will be times when it may seem everything is going fine but unknown to you are not achieving your business’s mission and objectives. Therefore, it is important for you to be looking for warning signs that your business is going off tangent or is failing. Let’s discuss five warning signs your busniess is about to fail and some ways you can avoid business failure.
5 Warning Signs Your Business Is About To Fail
#1. You have not spoken interacted with any customer
After your amazing effort ensuring the smooth management of your business for over a month and you have not spoken to any customer or a customer have not patronized you, there must be something wrong. Perhaps, you should rethink your marketing strategy. For this, you can use social media. You don’t need to break the bank.
#2. You always repeat the same mistakes
Mistakes are acceptable in business. You may have spent money on employing more people or purchased more machines against the advice of your business consultant. You should learn from these mistakes. But if you repeat this same mistake again and again, you will soon run the business aground.
#3. You recruit new employees weekly or monthly
Your employees cannot work with you for more than two or three months before they leave. This means there is something fundamentally wrong. It may be your relationship or your management skills that may be prompting them to leave.
#4. Your business is indebted
This sign is very obvious. If your business is heavily indebted, it is a warning sign you will soon be unable to service your debts and you have no choice than to liquidate. Before it gets to that level, you should do something about the debts.
#5. Significant drop in turnover
The economic outlook of Nigeria is not encouraging. The naira is fluctuating and it has just recently stable at N497 at the parallel market and even the government is not helping matters with its unclear monetary and economic policies. Notwithstanding, it doesn’t spell doom for your business. Your business should still run normally even with the recession. If this is the case, it may be time to overhaul your business strategy.