Warning signs that businesses should never miss out on

The pandemic has been a perfect storm for us to blame all our troubles on. But business has always been in trouble – it is just that we didn’t realise it.

Almost 70 per cent of small enterprises in the MENA region have been on the brink of closure or working with skeleton staff, according to an OECD survey. It is also the season for the retail apocalypse that shutter once-beloved brands and end old traditions forever. Bankruptcies hit their highest rate since 2015 - and experts are warning that we are far from bottoming out.

Even iconic retail brands Ann Taylor and Brooks Brothers to Neiman Marcus ran out of money in 2020. While it might be convenient to blame the pandemic, these businesses were already struggling, having missed major inflection points in consumer preference, shopping habits and changing cost structures.

Retail, though, is just a microcosm of a larger phenomenon, in which early warnings of a fading competitive advantage are not heeded. Many of the difficulties facing these entities could have been anticipated, given a number of straightforward early warning signs that are clear signals that things are potentially taking a turn for the worse.

Here’s a handy checklist for those businesses still struggling in the pandemic season.

The more of such indicators you see, the more likely it is that your business is on the cusp or well into the erosion phase of a dwindling competitive advantage. This is a signal that you need to stop whatever you are doing and take a hard-nosed look at the health of your business.

By the time the trouble is obvious to everyone, the inflection point would have passed.