This Checklist is about managing downside risk. It is an area that is easily missed, and is vitally important. All the hard work you have put into building your business, can be compromised or destroyed by things outside of your control. Whilst these areas are not nice to think about, they are part of growing your business safely and sustainably.
We would say from personal experience that it is the one areas that can creep up on you, and it is the one you owe to your staff, customers, investors and family to get right. How you managing downside risk is also the area, that investors and lenders look at, prior to helping your scale your business.
Here are some initial Checklist questions
- Where do you feel your business is most vulnerable?
- Finding Staff
- Keeping Staff
- Getting the most out of staff
- Finding Customers
- Keeping Customers
- Customer Satisfaction / Gross Profit management
- Change in existing Markets
- Finding new Markets
- Medium to Long term planning
- Short term implementation
- Innovation – New Products
- Customer feedback
- Overhead management
- Gross Profit Consistency across your product range
- Your Accounts – How comfortable are you with your numbers
- Should be forward looking
- Cash Flow projections
- Reporting on GP per job or product group (Consistency)
- Managing Cut off. WIP, Stock, Drs and Crs.
- Have you designed your accounts to give the best impression, or the accurate impression. (See 2.4 above)
- Early Signs things are going wrong
- Margins Sliding
- Customer complaints
- Staff infighting
- Resignation letters
- Dr and Cr days figures sliding
- Chasing letters etc
- What can you do about it
- ACT EARLY. Get help. You are not alone
- Every business goes through this. There is no shame. You created this business. Respect.
- Knowing who to turn to, is a difficult decision. One you need to get right.
- You need a plan of how to turn things round, AND depending upon how late you have left it, a plan to protect yourself from aggressive creditors.
- It is always better not to be in that position in the first place. Prevention is better than a cure
- Again from personal experience, managing cashflow, takes your eye of the ball, of running the business. It is no fun and its bad for your reputation, relationships and health.
You don’t know what you don’t know.
The best way to avoid that is to discuss it with people with actual, real business experience, of solving problems.
If you want to Go Fast, Go Alone. If you want to Go Far, Go Together.
You are amongst friends.