Businesses are established by people and for this reason; they can work and behave like an actual organic entity. A business could grow, expand, have new subsidiaries as its offspring and get sick. Here are some of the serious diseases that may affect our company:
- Cash-flow hiccups: When our company is affected by this disease, it is struggling due to tight cash situation. We may start to skip payment and when inventory is running low, we are not able to replenish it. In this case, we could start accumulating debts. The cure to this disease is by examining every single penny we spend and we should make sure that it is well spent.
- Suppliers’ and distributors’ pain: This pain symptom could happen when we rely too much on a single supplier and distributor. As a result, we are not able to negotiate for better rates. The health of our business could also be affected, because its essential functions rely on a sole provider. The cure for this illness is by being more aggressive and trying to renegotiate with our suppliers and distributors. If we can’t get better offers we should consider choosing a different supplier and distributor. Ideally, we should have at least two primary suppliers and distributors. This will allow us to get special deals.
- Impulse buy syndrome: This situation could affect business owners and any business would also need to equipments and raw materials for their business operations. We could cure this syndrome by re-considering the amount of money we spend on wholesale purchases. We should consider how much time we spend to process the whole stock of raw materials and sell the finished products. Before we place an order, we should make sure that these items will be removed from our storage into the processing facility and eventually to buyers’ hands. We may need an intensive media coverage, so we can sell our products faster.
- Inventory amnesia: This cognitive problem can happen, especially when we don’t remember which inventory items that bring in the most cash and cause the biggest losses. When our company is affected by this problem, we don’t know how each type of product could affect our financial conditions. In order to free ourselves from inventory amnesia, it is important for us to ensure that we have a highly reliable inventory management system. In this case, we will be able to check our current stock instantly. We could create promotional coupons and other offers to boost sales of poorly performing products.
- Discount fever: Our company may overheat when it is unable to release excess products from its system. This could happen when other competitors are selling at lower prices. In order to cure this illness, we should forget about price war. Instead, we should focus on providing the best value for consumers, even if our products are not the cheapest. In fact, it is not a good indication if people come only because our products are cheapest. People should purchase our products, because they are the best available option on the market.