Today we’re highlighting some adverse trends that indicate problems are arising in your business. If your business is struggling because you’ve hit a plateau, or your business is headed in the wrong direction, you’ll want to pay attention to these warning signs of decline.

Poor working capital controls will ultimately get your business into trouble. Working capital controls can get out of hand before the income statement does, and that’s why it is specifically important to pay attention to them. Get granular by tracking regularly in your day sales outstanding, days inventory, and days payable to get a more dynamic picture of the financial situation.

Declining reinvestment into the business is another red flag. Regular maintenance and sometimes even replacement for equipment is essential to sustain your assets. If the equipment doesn’t function, it cannot serve the business. While reinvestment can be dialed down or stopped temporarily, consequences will be dire if you don’t continue to reinvest.

On the more functional side of business ownership, turnover rate will indicate the health of the business. If company culture is poor, people will leave. The most talented and qualified people will find employment elsewhere, and you will be left with the individuals who are less desirable to other employers. Smart investors watch the turnover rate. Having a thriving company culture will prevent this problem.

These warning signs are intended to be a guideline for things to look at, but are by no means a comprehensive list. This list is designed to get you thinking about other potential red flags and to pay attention to the factors listed. The great news is these are all internal factors, which means that you as a business owner can take control and turn the business around.