American Finasco > Blog > Signs of Trouble

In the last decade, highlighting this past year, a lot of businesses ranging from small local businesses to large corporate conglomerates, have floundered and flatlined.

Here are 4 key signs that your business is in financial trouble.

1. Imbalanced Cash Flow

All small business owners know that “cash is king.” Consistent cash flow means there is enough cash coming in to cover all of your business expenses. This is vital to keeping your business healthy and operating. However, this flow can be easily interrupted. All it takes is one customer not paying on time that can ruin your cash flow cycle.

Negative cash flow is expected, but only for the short term.  This can happen when invoices are due before payment is received, or if you are positioning your company for future growth. But without positive cash flow, a business cannot pay expenses and therefore cannot survive. A cash flow strategy for small businesses and debt relief are necessary in these uncertain economic times.  American Finasco has been successful in providing options to our clients allowing recovery from overwhelming financial problems.

2. Creditor Pressure Is Growing

 It’s important to keep creditors happy and pay them on time. Paying consistently and timely makes you less risky as a borrower. This will work to your benefit when you need to extend your credit in the future. When struggling to pay bills, it’s tempting to put off paying invoices. But doing so will disrupt any good relationship with creditors, who will start hounding you and even resort to legal action for payment. American Finasco will help provide strategies and take the weight off business owners who are feeling pressure from creditors.

3. You’re Refinancing Constantly

Refinancing will free up cash in company assets and is not necessarily a sign of financial trouble. When interest rates drop, refinancing makes perfect sense. While refinancing once is normal, your company must be able to afford the repayments. Using refinancing as a line of credit could be a red flag and lenders will become wary of companies constantly refinancing.

4. Capital and Staffing

It’s always wise to revisit your business budget. However, considering cutting salaries is a sensitive area in which many businesses struggle. Quality employees are essential to a business’s success. So, paying employees what they deserve should be considered an investment. Finding quality people can be hard, if you cut salaries, they will most likely find higher-paid positions elsewhere. Staffing issues can quickly lead to future financial issues.

There isn’t one company immune to financial trouble. If you find your business overwhelmed with debt, it’s time to call American Finasco. Contact us today to get your business on the right track! Visit Contact Us and complete our Online Form for a free consultation or call (800) 299-2909. We look forward to speaking with you.