Summer holidays are a time to unwind and refresh, but of course commerce carries on regardless. A salutary reminder of the need for constant business vigilance arrived in the form of a new piece of research by Ernst & Young into quoted company profits warnings (press release). Despite the recovery, E & Y found company warnings at a three-year high. The question to ask is how vulnerable would companies in your supply chain or customer base be in the event of a sudden collapse in profitability? After all, we know from (bitter) experience many borderline companies can struggle on for years until a catalytic event – such as a large fall in profits – suddenly seals their fate. See example illustration of the impact of Profit Warnings – Brightside Group
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