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The tell-tale warning signs of trouble are there, but perhaps you don’t see them or more critically you ignore them. Either way, if you don’t take action to remedy the situation your Business will suffer, be severely damaged and even fail.  

The 4 warning signs of trouble include: 

1. Poor cashflow 

2. Weakening financial position 

3. Not keeping up with compliance obligations 

4. Changes in customer behaviour 

1. Poor Cash Flow 

Signs such as, 

• You have a cash deficit, or you are unaware of your cashflow position 

• Creditor/customer payments are late or irregular 

• Payments to suppliers are unreliable or you struggle to pay 

• Profits are low despite a healthy turnover rate 

What you can do, possible remedies. 

Starts with improving your cashflow management and starts with the following steps; 

• Set up a cashflow forecast and closely monitor it 

• Chase up late payments and any monies owed to you 

• Establish/review Terms & Conditions for Customer payments & credit 

• Review your operating costs across all areas to find opportunities to reduce outgoings 

• Seek expert advice from an experienced Accountant. Blackburn Accounting your family Business Specialists, offers a broad range of personalized professional services.  Act now, contact the Team today. 

2. Weakening Financial Position 

The crux of the matter, simply said, without sufficient funds your Business will no longer be able to continue operating or trading. 

Warning signs include

• An overreliance on borrowed funds to operate 

• Profits and sales are going down 

• You are unable to meet outstanding debts 

• Costs have increased but revenue hasn’t 

What to do.  

Get professional advice asap. Don’t avoid or ignore the problem.  

• Speak with your Accountant regarding possible strategies you might implement to improve your situation. 

• Speak with your Bank they may have hardship relief or support options available. Again, act asap. 

• Check if there is any Government Assistance available, such as grants or relief packages. 

• Carefully review your product and services, focus on higher profit margin goods rather than low margin ones 

3. Not keeping up with your compliance obligations 

Your true financial position can be difficult to fully understand if you are not meeting Business compliance obligations. 

The warning signs are, 

• You are behind in your (BAS) Business Activity statements, Superannuation payments to staff or Tax returns 

• Records for your Business are not being kept up to date. 

Take action today 

• Contact the ATO Small Business Support Unit. Discuss your situation and they may be able to offer answers such as setting up a payment plan or deferring a lodgement. Seek help, you can only ask. 

• Get on top of your record keeping. If paperwork isn’t your strength engage a Bookkeeper or Accountant to help. Blackburn Accounting provides these services. Your Business activities will be better placed and more organised. And who doesn’t want that. 

• Check access to support from Financial Counselling Services available to small Business owners in WA. Some services may be free. 

4. Changes in Customer behaviour 

If you are losing custom, and demand for your products or services is falling your Business will be adversely affected if left unresolved. Likewise, if financial constraints are impacting quality, business will suffer.   

Signs to look for that customer behaviour has changed 

• Loss of major clients/ regular customers not so regular 

• Decrease in sales 

• Increased complaints 

What to do 

• Critically find out why you have lost business, seek feedback from lost customers and clients. Surveys, in-store forms, phone, text, or Online apps are all ways to reach out and connect with them. 

• For major clients set up a meeting, the personal approach can help build relationships and deal with any issues. 

• Sales opportunities, explore cross-sell and upsell options. These can be very effective rather than discounting products.  

• Adopt Marketing methods and activities that embrace all promotional opportunities, whether Inhouse or online. The way forward, digital marketing is cost effective and can help you generate sales. You can’t afford not to be in this space to attract, entice and engage existing and new customers and markets. 

• In response to increased complaints get to the heart of the problem by asking about and listening to customer concerns. Importantly, act and take positive steps to win back valued custom. 

Key Takeaways:  

What to do when your Business is showing signs of trouble 

• Don’t delay taking action 

• Contact key Stakeholders 

• Seek expert advice if needed 

• Importantly, make sure you take care of you!