Hundreds of small businesses failures in the first quarter could have been avoided if owners had not ignored early warning signs and used a '33 week window' to save their venture according to research.
By Roland Gribben Last Updated: 9:37PM BST 06 Apr 2009
An estimated 880 small companies, accounting for one in six of insolvencies in the period, closed their doors because they had not taken remedial action early enough or failed to carry out any forecasting, the report adds.
Business adviser Tenon Recovery, which used its own client base for the research, estimates that a company has 33 weeks to discover whether turnaround initiatives could work after determining that future prospects are bleak. (i.e. half a year)
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The remedies include
- establishing key business indicators,
- forecasting cash needs on a weekly basis,
- outsourcing specialist jobs like bookkeeping,
- reviewing and swapping suppliers, and
- continuous spending reviews.
Carl Jackson, head of Tenon Recovery, said many enrepreneurs "have little or no experience of operating in a recession and... are not used to having to keep such a close eye on their business".
http://www.telegraph.co.uk/finance/yourbusiness/5116161/Business-failures-could-be-avoided.html
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