You would think that that the signs of a failing business would be obvious: lack of customers, dropping sales, cash flow issues…but these are all symptoms caused by a business that has already been failing for a very long time. What if there was a way to know if your business is failing long before the symptoms start showing up? A failing business does not happen overnight. It is the result of months, sometimes years, of poor management, common mistakes, and an inability to see the signs before it is too late.
My clients generally contact me after the symptoms of a failing business start to show. Unfortunately, at this point for many businesses, it is already too late to help them. They waited too long to ask for help. The good news is that there are early warning signs that your business is failing. If you can learn to spot these three signs and make the necessary changes, your business will continue to thrive.
1. Saving money is more important to you than making money.
This is really one of the most common signs that your business is failing. Whether in business or in your personal finances, it is always a good idea to be wise with how you spend (or don’t spend) your money. The issue for many business owners is that we end up spending so much time and energy trying to save a penny that we never get the opportunity to go out and earn a dollar. We all know too well that we only have so much time and energy in a day.
What we often fail to remember is that as business owners, time literally is money. Or, at least, it takes time for us to go out and earn money. If we are too busy consistently spending our time on trying to save a penny, when will that dollar be earned? Eventually, we will have a nice stack of pennies, but the sacrifice is that we were not out earning dollars. Over time, our customers and sales fall away, and we find that our stack of pennies we collected won’t even pay to dig us out of the hole we dug.
2. You worry about the wrong things.
A good question to ask yourself is: would you rather save money or make money? Of course, your answer is that you would rather make money. Now let me phrase the question a little differently: what do you worry more about, saving Money or making money? We all would say that we worry a lot about saving money. Here we are faced with a dilemma: we care more about making money, but we worry more about saving money. Human nature dictates that we tend to spend more time focusing on the things that we worry about. By our very nature, we end up being counterproductive as we start chasing pennies around while dollar making opportunities pass us by.
The key here is to change our way of thinking. We should worry about making money, but care about saving it. With this frame of mind, the focus becomes doing whatever it takes to make money while at the same time insuring that the things we do spend money on are cost effective (meaning that the things that we spend money on help us make more money by freeing up our time and energy).
3. You don’t think you have the money to spend on the help you need, so you wait.
I hear this sad statement all too often; “I know what needs to be done, but I don’t have the money to do it”. Whether you know it or not, this frame of mind, puts your business on the fast track to failure. Not doing the right things, because you don’t think you can’t afford them, is just simply starving your business to death. There are many variations to this phrase: “I will start advertising once my sales increase a little more,” “ I would hire the help I need to grow my business but I can’t afford it,” “ I just don’t have the money for anything other than maintaining the status quo.”
Let’s just be real with ourselves. Sales and growth don’t just happen on their own. If your plan is to simply wait until you are making more money, all you are really doing is waiting for failure to slap you in the face. If I told you that I needed more cash so I am sitting here and waiting for my bank account to fill back up, you would think I was crazy. Yet we think like this all the time when it comes to our business. Sales aren’t where we want them so we wait…we don’t have the money we need so we wait…there is a 100% chance that the act of simply waiting long enough will never produce results.
If your business is not growing, the only option is to change something. Change where you spend your money, fire the wrong people and hire the right ones, spend your time making money not just trying to save it. Business is all about using your resources wisely, but you have to use them. If all you are doing is banking your time, money, and energy and hoping that eventually your wait will pay off, you will be disappointed. Business is not about waiting – it is about taking risk and expending energy. I can guarantee you that every business that has failed did so while waiting for their big break. On the flip side, every business that has ever succeeded did so by using their time, energy, and money to create their big break.