Insolvency affects businesses large and small every day. Whether your company is stable and in profit or whether insolvency is a concern for you, it pays to heed the following five reasons why many businesses become unable to pay their debts.
Variable Cash Flow
For many companies, cash flow goes up and down. Not having a contingency fund for the leaner months can lead to mounting debt.
Losing Out to the Competition
In a market where there is little or no competition, it’s easy to ride high. But what if suddenly a lot of competitors flood your market or, worse, what if they are actually offering a better service or product than yours? Keeping an edge means working hard to ensure your business is giving value, quality and service across the board.
Not Listening to Your Customers
A business that is spiralling into insolvency may well ask, ‘what are we doing wrong?’ When it comes to feedback, your customer base is a highly valuable and important source. Simply listening to their comments can often help to turn things around.
If your business has a problem with mounting debt, the fastest way to make it worse is to ignore it. Seek out expert insolvency advice as soon as possible in order to bring the debt under control; there may be solutions you hadn’t thought of to help move things in the right direction.
The saying ‘the fish rots from the head’ is never truer than in business. A manager who doesn’t know how to manage effectively, whether it’s staff, budget or customers, will ultimately damage a business and only help to drive it further into debt.
One of the best ways to get your business on the road to being healthy and profitable is to seek out the best advice. Irwin Insolvency is on hand to provide understanding and practical guidance for personal or company insolvency, so pick up the phone today or contact us online here.