Reading Between the Lines: Identifying and Anticipating Red Flags

“Paying close attention to not just what someone says but the way in which they say it can help you to read between the lines — a place where the real story is often dramatically different to what the casual listener might understand is being said on the lines.” —?Richard Branson?( Founder of Virgin Group)

Research studies have shown that there are over 30 million small businesses in the United States and hundreds of thousands start-up every quarter. Although many of these businesses are honest, some may have exploitative operators. Ravila Gupta provides five tips and takeaways from real-world experiences on how to read between the lines and identify these red flags.

A strategist at the intersection of executive leadership, engineering, law, and executive coaching - I approach each business problem with a multifaceted approach.

“I will give you five takeaways from real-world experience that one should be able to read between the lines.

“Firstly, if receivables are getting much greater than revenue growth, that’s an indication that the company is not collecting. This is a red flag.

“Second, distractions in the company like an increase in property expenses which leads to people focusing on layouts, and office building. This is a distraction in the company and another way to read between the lines.

“Third, if the debt is increasing disproportionality to revenue, that would be a concern.

Fourth, if payables are going up it means that vendors are not getting paid.

“Fifth and the last one is if the owner started to take a lot of money out of the company. This may be a red flag because they are not leaving enough money in the company for future growth. These are my five takeaways.”

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