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Signs Your Business is in Trouble

If your business has any of these signs, please contact us to discuss ways to improve.

Financial Dirty Dozen signs of decline:

  • Declining revenue
  • Declining gross margin
  • Increasing overhead against flat or declining revenue
  • Sustained losses, especially for more than 12 months
  • Stretched accounts payable
  • Substantial back taxes
  • Vendors require cash on delivery or cash in advance
  • Liquidity crisis — scramble to meet payroll
  • Going concern opinion
  • The bank has recommended the client hire an outside consultant
  • Assigned to their lender’s workout group or operating under a forbearance agreement
  • Filed, planning to file, or asking about bankruptcy

Operational Dirty Dozen signs of decline:
 
  • Disorganized shop, dirty machines, poorly kept grounds, office clutter
  • Scrap bins are full/high rework
  • Poor delivery performance
  • Excessive inventory — especially work-in-progress
  • Excessive material movement
  • Idle equipment/low equipment utilization
  • No work instructions/no standard operating procedures
  • Lack of visible metrics
  • High employee turnover
  • Absence of employee and management interaction
  • High accident incident rate
  • Management defensiveness