Dear Wise Aunty B,
You must talk to a wide range of companies (whoever you are.) I was wondering if you could tell me which companies are in the most trouble?
Some companies are doing very well, and other business owners are screaming from the roof tops. It doesn’t seem to be industry specific either.
Can you see any pattern?
Confused Bruce B,
Dear Confused Bruce,
There are some industries that are struggling more than others – particularly those in the finance sector! But I know what you are saying. It is a mixed bag.
However I can see some patterns. Here is my list of who is already in trouble – and which companies will get into hot water.
Companies in trouble:
- The me-too companies are in trouble. In the boom they did OK. Now there is nothing to differentiate them.
- Business owners who are uninformed and refuse to see how globalisation is affecting the business.
- Companies that have had bank loans knocked back.
- Companies that took huge risks in the boom and were unprepared for the downturn.
- Companies dependent on consumers who have cut back on spending.
- Companies with poorly managed cash flow and debt collection processes.
- Companies with poor management.
Companies that will be in trouble soon:
- Have their bank loans withdrawn or refused.
- Lose their best staff, particularly those in sales and marketing.
- Have business models that mean they cannot adapt easily to a downturn (I include many franchises in this).
- Those that cut back on their marketing and pipeline development.
- Companies that do not understand every single cost.
- Business owners who see innovation as a cost.
- Companies that are in a high risk industry and get hit by bad debts from other businesses in trouble.
Bruce, I hope you are none of the above.
Your Aunty B.