What are the signs that your business is about to die/fail and how to revive it

Once your business is about to fail, it will show you some dangerous signals. Once these signals are identified, you must take corrective measures in order to stay in the business.

These are some of the signs that your business is failing;

1. REDUCTION IN SALES

If your business is failing, your sales will keep reducing. Some factors such as low quality product, high product price, poor distribution, ineffective promotion, poor customer service, irregular supplies of raw materials, little or no competition and inconsistent operation of the business could definitely reduce your business sales.

When such factors occurred, you must have to reposition your product.

Ensure you work on your product quality such as re-packaging, labels, size, colours etc.

Put more effort in promotion. Some promotion mix includes advertising, sale promotion, Public relations etc. Make use of them judiciously.

Improve on the services offered to your customer by given discount, credit sales, bonuses, timely delivery, home delivery, conducive business environment etc.

Choose effective distribution channels and ensure your products are delivered at the right time, in the right place and in good condition.

Make sure you have regular supplies and distribution.

 fix the right price, always make sure that your business is operating, monitor your competitors closely and try to outperform them. Once you can do all of these things appropriately, your sales will continue to increase.

2. REDUCTION IN PROFIT

If your business is failing, your profile will keep reducing as the result of high cost of operation. If the cost of materials is high, utilities and taxes are high, if you pay high salaries and bonuses to employees, if you are unable to track your credit sales and purchases, if you give to much discount and bonuses to your customers, if your employees are secretly consuming from the stocks, if you incurred a lot of wastages and spoilage these are big signs that your business is failing.

Ensure you operate carefully to reduce wastage and defection, monitor your employees, careful with how you sell on credit and how you purchase on credit, look for where you can get raw materials at cheaper rate, if there is need to reduce/retrench your employees do it, you can employ some on a contract or part-time basis, you can as well do outsourcing. Make sure you minimize cost as much as possible.

3. INCREASING IN DEPT

If your business is failing, your debt ratio will be higher than your current asset, you will be unable to maintain the equipment, you will be unable to pay staff, you will be unable to pay rent, your credit purchase will be high, your stocks will be too low. 

Once you experience these signals, borrow to finance your business, or you can go into partnership or diversification.

I hope this is helpful!