Inability to create realistic and precise goals that include deadlines in a formalized strategic and operational business plan.
Inadequate financial records:
Keeping track of how much money is on hand, and how much is owed, in order to understand the financial picture. The lack of maintaining detailed books
and an appropriate record of sales.
Disregard for or misinterpretation financial records:
Improper funding and failure to oversee debtors and creditors are examples of disregard or misinterpretation of records. Keep control of payables and
receivables. A business could experience a profitable year and have solid accounts receivable on the books, but be cash poor due to lack of control.
Failure to control costs:
Build an information system that tracks cost embedded in each business function or process to control costs. The system should track actual time
expended so that labor costs can be controlled while providing incentives for employees.
Lack of internal control:
Personally take the responsibility to decrease fraud by putting controls in place to prevent a diversion of funds, inventory or property.
Poor sales and customer relations:
Talk with your customers about their focus and interests. The extra effort to increase customer service and sales will set your company apart from
competitors and increase sales.
Insufficient working capital:
Although some businesses might be able to survive for a short time with a small amount of capital, eventually the money runs out. Initial development of a
business is crucial and should be supported with a financial cushion.
Lack of adequate and appropriate insurance:
Families dependent on income generated from their business should carry long-term disability insurance. Additionally, adequate life insurance protects
owners and families from financial hardship. A disaster, such as a flood or fire, can destroy a business. Inventory and assets must be insured.
Failure to adequately train and develop employees:
Create a team work environment that keeps staff motivated and happy. Employee involvement in the business, training and increased education promotes
a feeling of ownership.
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