Tweet

Business Problems? Is My Business in Trouble? How Can I Tell Before the Worst Happens?

Written by: Lee Lister

Article Overview: It is a well know fact that many businesses fail within the first few years – so how can you make sure that your business is not failing at the moment. Here’s a Business Health Check for you. Sit down quietly in your office, with your records to hand and work your way through this business health check. You don’t need to do it all at once, but try and do it within a few days. You should review each question deeply in order to get a detailed view of your business.

Business Problems? Is My Business in Trouble? How Can I Tell Before the Worst Happens?

It is a well know fact that many businesses fail within the first few years – so how can you make sure that your business is not failing at the moment. Here’s a Business Health Check for you.

Sit down quietly in your office, with your records to hand and work your way through this business health check. You don’t need to do it all at once, but try and do it within a few days. You should review each question deeply in order to get a detailed view of your business.

Management
1. Do you rely too much on one manager, including yourself?
2. What would happen if one or more managers left or were ill for some time?
3. Do you have enough managers with the right experience?
4. Do you have too many managers?
5. Are your managers trained or experienced to the optimum level?

Staff
1. Do you have enough staff?
2. Do you have a high staff turnover?
3. Can you find staff with the right skills and experience?
4. Are your staff fully trained?
5. Are your staff in the right departments and geographic areas?
6. Do you have a strong sales and admin group?

Operations
1. Your internal efficiency – does your company run efficiently from marketing to after sales?
2. Can you manufacture or fulfill your sales quickly and meet your customer’s expectations?
3. Do you have bottle necks in any of your business processes?
4. Do you receive frequent complaints about any part of your business?
5. Can you provide your goods and services during sales cyclical increases?
6. Do you have high stock levels that you regularly have to sell off at below normal prices?
7. Do you have a strong marketing and advertising strategy in place?

Sales
1. Are your sales strong and gradually increasing?
2. Are your sales reliant on external factors that you have no control on? Think ice cream seller.
3. Do you have strong cyclical sales and can you cope with them?
4. Do you have alternative products and services available for periods when your standard stock is not selling so well. Think diary sellers.
5. Do you have a strong product range that has a naturally increasing set of price points?
6. Do you have up sells available to capitalize on each customer’s total sales value?
7. Do sell products that are complimentary to your major products?
8. Are you selling what your customers are asking for?
9. Are the sales of one particular product diminishing?
10. Do you often get asked for something you don’t have?
11. Are you sure that the prices you charge are set at the optimum level.

Financial:
1. Do you have a steady cash flow or are there periods of stagnant or negative cash flow?
2. Do you collect the majority of your invoices within 30 days?
3. Do you have a problem with obtaining loans?
4. Are your stock costs high?
5. For retail or manufacturing companies. Are your staffing costs a large proportion of your total costs?
6. For service companies. Are your charge out rates at least 200% of your staff rates.
7. For service companies. Are your consulting staff being charged out at least 75% of time?
8. Do you have a good gross profit?

Suppliers:
1. Can you suppliers force you to take large deliveries?
2. Are suppliers difficult to find?
3. Is supply readily available?
4. Do you have the opportunity of obtaining supplies from several companies?
5. Can you obtain deliveries when you need to?

Customers:
1. Do you rely on just a few customers?
2. Can some of your customers insist on lower prices?
3. Do you have a lot of late payers?
4. Is the cost of obtaining new customers high?
5. Do your customers often repeat order?
6. Do you have a high percentage of customers who only order once from you?

Market:
1. Is competition very strong?
2. Do you have a near monopoly?
3. Do you have a strong and recognized brand in your market place?
4. Are you aware of future changes in your market place and changing your offerings to meet these?
5. Are you leaving some market niches unexplored or untouched?
6. Are there markets that you could exploit?
7. Are your marketing costs a high proportion of your costs?

These questions are planned to give you a good understanding of the weaknesses of your business. If you have too many negatives then you know you have some remedial work to do.

Related Articles
  Careful Consideration and Analysis
  Rut Busting
  Caring for Aging Parents: What's The Best That Could Happen?
  Best and Worst
  Crisis Management

Article Tags: admin group, advertising strategy, alternative products, bottle necks, business health check, business management, business processes, external factors, few days, first few years, frequent complaints, geographic areas, group operations, internal efficiency, level staff, optimum level, staff turnover, stock levels, strong sales, time 3



Related Forum Posts
My entry - 1. The Best Business Books Ever: The 100 Most Influential Business Books You'll Never Have Time to Read - this is a fascinating book about the history of Business theory, and I'd recommend it to anybody. 2. The Big Book of Small Business: You Don't Have to Run Your Business by the Seat of Your Pants, by Tom Gegax. Ditto. 3. PADI: The Business of Diving Book Okay, so this book won't be of use to anyone who doesn't want to start a scuba store, but I did, and this book was of course invaluable to me in reaching that goal.
Exclusive: Interview with Results - Hi Forum Members, I'm helping start up a Business Coaching and Consulting company here in Toronto, Ontario, Canada (a Subsidiary of RSC Business in Los Angeles). As a Research and Development Intern I am required to practice my listening and interview skills by surveying Small and Medium Businesses on thier Business. This Survey is designed by RSC Business to also assist the Business being interviewed more insight into their own business. I am looking to interview about 30 businesses across North America over the span of 3 months. At the end of these interviews I will be publishing a report of the results and they will be made available for free to the Interviewees. The Report data will include responses from a minimum of 100 interviews. I would like to extend this opportunity to members of the Forum. If you would like to have this short 20-30 minute interview conducted on your Business and you reside in North America please send me an email or PM. Please contact me at andy[at]jvprosperity[dot]com to arrange our interview and to get free access to the results when they are published.
Re: HOw to market a B2B consulting company - [quote="zohahunt77":428owzbi]Hi, I was wondering if anyone can tell me the difference between B2B and B2C. I don’t know about b2b marketing but I have done marketing so know things about it. I will suggest you to take online services which will spread your business all over web network. Online marketing is the best way to market any business.[/quote:428owzbi] B2B = Business to Business - You are marketing to other businesses. B2C = Business to Consumer - You are marketing to consumers.
English teachers learn Japanese as Interns - Yasunori, what about the many students that leave N. America to teach English in Japan. They may want to learn Japanese (maybe Business Japanese is a bit different) and the Japanese Business Culture.
New Study - Women prepare better business plans - I found an article in Business Week and I found this quite interesting. [quote:ka7lg35i]Who Prepares Better Business Plans, Men or Women? A new study based on four years of data from men and women in a training program for microenterprises finds that they come out the same in quality scores. "However, women scored significantly better on the presentation of their plan to judges," conclude the study's authors, Ronald G. Cook, Paul Belliveau, and Christine Lentz of Rider University, in a paper presented at a recent meeting of the Small Business Institute. [/quote:ka7lg35i] What do you guys think?


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

When Living the Dream isn't enough!

Web Design in 30 Minutes - Can this be Right?

How To Be A Management Legend

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.