Over the years I’ve had the privilege of working at a few companies that either went out of business, or closed off a significant portion.
This is a very frustrating experience to endure more than once, but the one positive that came out of these scenarios was learning about the commonality between the companies that failed.
Uncoincidentally, two of these businesses made a lot of the same missteps, and by my second time seeing these signs, I was able to better plan for my future without being blindsided by an unexpected layoff.
Here’s a few things to look out for when you’re worried about the future of your company and your job.
You’re Not Getting Paid on Time
This is one of the biggest red flags concerning the well-being of your company. If they consistently pay you late, or not at all, then you need to consider quitting or finding other employment. This can often be attributed to either a lack of cashflow, or poor management of the company’s funds. I’ve also seen cases where bootstrapping is employed to slow down the payouts of a company.
Now, I have been at one company for a significant amount of time that did this on a regular basis and managed to survive until this day, despite their horrible reviews on Glassdoor. And even though the company is technically still in business, it is no longer growing and thriving the way that it was when I was working there.
Vendors Are Not Getting Paid
When any company being used by your employer pulls the plug on their relationship because they haven’t been paid, you should start worrying about your own paycheck. Especially if the service is vital to the everyday operations of your company. If your company is desperate enough to jeopardize one of their relationship with one of their most important partners, then laying actual employees off isn’t that far behind.
Money is Spent Frivolously
If you work at a company that is attempting to grow by spending money on extravagant things like helicopters, over-the-top parties, and expensive consultants, then it’s time to start looking elsewhere for work. If it’s a company that’s been around a long time, it might be a season where they decide to get flashy. But if it’s a start-up with not much of a track record, you might have to start planning your exit.
Puffed-up executives oftentimes like to waste the company’s money during a time of rapid growth. But the problem with this is it sometimes goes too far and cuts into operating expenses.
There are also poor business models that see companies spending way too much in a particular area and not getting any type of return on it. This can also be considered frivolous spending. If you see your company spending more than it receives in revenue know that this is a red flag.
The Place is Always Dead
If you work at a store or restaurant and there are never any customers there then you should know that this is an unsuccessful business and the only way it will survive is if it’s a front for criminal activity.
If you find yourself sitting around doing nothing most of the time there’s a good chance that the entire business is being mismanaged and ran into the ground. I’ve been in this particular situation a few times. This seems like common sense, but a lot of workers will remain in jobs like this because they are either lazy or just ignorant. Bottom line is if there’s no money coming in the place will not last.
The CEO or Owner is Never There
If you work at a small business and the owner never shows up, that is not a positive sign. This can lead to a list or problems including someone else running their business into the ground. If the person whose vision it is to make this business work doesn’t care about it, then no one else will. That’s just what it is.
In larger companies, acting CEOs should show their faces every once-in-awhile and make the employees believe in their vision. If you never see or hear from them it’s likely that they know the business is failing or just don’t care about it anymore and are hoping to be let-go at some point to pursue other endeavors.