Whether economic conditions, unexpected costs, or employee negligence is to blame, running a business that is financially sick can put pressure on any entrepreneur.
Like most types of illness, a sick business can be cured if action is taken in good time – here is a guide to saving a sick business.
The Signs of Illness
Many business owners are taken by surprise by financial problems. A meeting with the company’s accountant can reveal losses that you were not even aware of, or a sudden slump in the economy could result in falling sales and a loss of regular customers. In the worst-case scenario, your business could fall prey to fraud in the form of a dishonest employee or clients who are trading recklessly and fail to pay what is due to your business.
Whatever the cause of your financial distress, it’s important to take action as soon as possible once you realise that your business is in trouble.
Who You Can Turn To For Help
As an entrepreneur, you pride yourself on having built your business from the ground up – and rightly so. However, during times of financial distress you should avoid the temptation to take all the stress of returning your business to profitability on your shoulders.
Speak to your accountant and financial advisor about the state of your business and arrange a planning session where you can look at your options and decide on the best path forward. If you have partners or financial backers, these people should be informed as soon as possible and in a way that presents the facts to them without causing a panic.
Healing a Sick Business
Your financial advisor will assist you in identifying the cause of your current financial troubles, and with the help of your accountant, your company’s attorney, and others, you’ll be able to get your business back on track – the sooner you recognise that there is a financial problem in your business, the better your chances of recovery.
While you formulate your strategy, you can help your business along by doing the following:
- Keep your books up to date – this is essential for the business recovery process
- Assess your tax situation – any unpaid taxes must be settled as soon as possible
- Cut costs – put new purchases on hold and don’t hire any new staff members for the moment.
- Prepare yourself for the road ahead – with a passion for your business and the right advice, you should soon be on the road to recovery.
About the Author: Nico Kleynhans on Google+