How to Recognize Red Flags in Your Business

Are you good at recognizing red flags in your business? Red flags go a step beyond boundaries. They include non-negotiables for things like business hours and how your clients can reach you. But it’s also things like the qualities of the people you want to work with or behaviors that make someone a NO to partnering with.

A lot of times, entrepreneurs create these non-negotiables as a result of a mistake, or a challenging experience, but in an ideal world you get super clear on these ahead of time.

This blog post is a tale of not listening to that gut intuition, the lessons I learned from it and tips you can use so you don’t find yourself where I was as a young business owner.

In the early days of Confluence Business Solutions, I had a prospect reach out and ask to work with me. Before even a single conversation was had between us, he was ready for me to get started right away. It was a Saturday and I was thrilled that someone was excited to be working with me. Looking back, here are two mistakes I made that night.

Mistake #1

I agreed to hop on a call with the prospect on Saturday night. During the call, he explained that he was desperate to get a complete funnel set up right away. He had a sample to use as a guide and he needed me to create the sales page and all the other collateral as quickly as possible. It was imperative that I start immediately on this project.

Mistake #2

I explained to the prospect that while I’m happy to help him design the pages, and set up emails and automation, I do not write copy. But despite this, he begged me to write the copy for the sales page, so I reluctantly agreed. 

The Downward Spiral

The following day, I got to work. I spent hours creating a sales page for his offer using the sample he provided me. The problem was I chose the wrong step in his funnel strategy, which meant all my efforts were wasted. When I shared what I had created with him, he was immediately irate. I was surprised by his reaction, but right away offered to make it right. Being a people pleaser, I went straight into “fix-it” mode. I was devastated that I had disappointed this stranger who trusted me with his business.

His response was that I was incompetent and a fraud and fired me. He then proceeded to send harassing emails making threats to my business and reputation. Even going as far as leaving a negative public review. 

Red Flag - Downward spiral

The Aftermath

The entire experience wrecked me to my core! 

In the nine years I have been in business, I, like every other entrepreneur, have questioned my sanity for choosing this life. But never have I felt as horrible as I had that day. I have never wanted to quit or give up more than those moments.

It took months for me to recover. 

When I looked back on that experience, rather than blaming the client for what happened, I choose to look inward. My key takeaways from the experience surrounded my non-negotiables and my willingness to ignore red flags that I was fully aware of when I agreed to work with this person. 

In my case, I crossed my own boundaries by taking a call and agreeing to work on the weekend, as well as offering to do work that was not part of my service offerings. 

I had ignored red flags regarding qualities I look for in clients. The worst part is, I knew he felt wrong to work with in how pushy he was to get me to say yes to his wants and needs and how little disregard with how I work.

I chose to use the experience as a painful lesson in how important it is to know your non-negotiables and to honor yourself by keeping them. My best advice to you is to listen to your gut and trust your intuition. Red Flags pop up for a reason and they are our intuition’s attempt at protecting us.

Here are some tips that aide you in recognizing red flags in your business and how to navigate your own non-negotiables:

*Pay Attention to Communication Patterns

Recognize when communication becomes an issue, be mindful of vague or evasive responses, withholding information, or an unwillingness to discuss important matters. Address this by setting expectations for transparency and regular communication, and consider seeking support from a colleague if needed.

*Be Alert for Unethical Behaviors

Ethics and integrity should be non-negotiable in any business. Be attentive for signs of dishonesty, fraud, or illegal activities, and address any unethical behavior immediately.

*Assess Alignment with Business Values

Whether a client, business partner, employee, shared values are a must. When you have an established set of values and expectations, it becomes easier to identify when someone is out of alignment.

*Monitor Financial Indicators

Keep an eye on unpaid invoices, inaccurate financial reporting, or unexplained cash flow issues as indicators of potential mismanagement.

Recognizing red flags in your business is crucial for maintaining a healthy, successful business and mindset. Recognize that clarity is the first step and practice the second. Be committed to maintaining your non-negotiables and adapting as your knowledge and experience grow, so you’re supported for the lifetime of your business. 

Join me April 26, 2023 for a free training on how to fix common roadblocks that slow you down in your business: The Perfect Customer Journey.


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