As an employee, one has to be very observant not only in matters of work but also in matters concerning your employer’s stability. We all need a job to sustain a living and it would be one hell of a nightmare to go to work one day and find out that the company is folding, closing down, going bankrupt or liquidating; in other words, ‘the end’. But even if it is the case, the same shouldn’t hold true to employees. This makes it important that one keeps their guard up and stays aware of the warning signs of an employer going broke. Today, we give you the said telltale signs with the help of insolvency experts from Edinburgh.
Sales and Orders Slowing Down – It’s natural for slow and plateau levels to occur given the presence of certain factors like poor economy or seasonal purchasing cycles but when they happen drastically that they slow down and drop at such a high rate, it could denote a possible financial crisis.
Consumer Crashes – When a particular client, especially one that consist the bulk or a significant share of total orders, goes under and liquidates, it could bring the company with it.
Work Stagnancy – When work seems to be slow and stagnant then it could mean a lack in client and sales volume. Less work means less is happening and when such a thing occurs insolvency will rear its ugly head.
Abrupt Cost Cuts – It is normal for businesses to minimize expenses but abrupt cost cutting with less to no explanation are a desperate means to minimize losses and pool remaining resources. This is the first line of action taken by employers who are having some sort of crisis.
Lesser Benefits – One of the first casualties of the cost cuts would have to be the employee benefits. This could be different things for different companies. There can be no bonuses or salary increases, absence of the usual corporate outings and trainings or things as simple as free coffee at the office and gym memberships.
Less to Zero Upgrades – Companies will always seek for improvement and this can be seen in equipment and machineries. When the company avoids or decreases such upgrades, it is most definitely reducing its current costs which should in itself raise red flags.
High Turnover/Resignations – Lastly, Edinburgh warns employees of the high turnover and resignations. This begins with the higher ranking officials as they are first to detect the problem. Everyone wants to save themselves so if a lot have been jumping off the ship and into safety boats then you have to be alarmed.