As we move into the second half of the year whilst the general economic situation is still uncertain, the opportunities to be Building Better Business finances are ever-present.
Working with my clients these are the things we have done which make their businesses more resilient and sustainable, even, perhaps especially with the current uncertainty.
Delay or cancel non-essential spending.
A small amount of work has yielded significant savings in my business and for many of my clients. There’s a reality that most businesses leak money through inertia and lack of visibility. We may have a multitude of domain names, software such as apps and premium website plugins and subscriptions that individually are small each time they renew, but collectively add up.
Recommendation: Audit those areas of the business and log them along with their cost, and renewal dates. Disable automatic renewal for any that are nice to have. Add new purchases and mark deletions in the log regularly.
Accelerate targeted investment.
There’s always a need to develop parts of the business, as part of Building Better Business, and most improvements need investment. With my clients, we have been reviewing strategy and looking at the opportunities by addressing structural issues or developing new products and services. For example, I invested in the things that were needed to launch the KickStart programme using working capital. I’ve improved equipment for zoom meetings, commissioned additional design work and marketing support. If you don’t have working capital currently available then strategic use of some of the current measures (such as the Bounce Back Loan scheme) can give access to capital on preferential terms. That allows you to invest now.
Recommendation: Plan the things that will advance your business and invest in them now if you can. Well prepared businesses thrive.
Preserve operational cash
Over the years I’ve seen many good businesses fail because they run out of cash. I’ve worked hard both for my own business and with clients, to create cash reserves. Holding money for known future liabilities in separate accounts, for VAT and other taxes for example, or for other major upcoming expenditure. That gives me certainty and clarity about the real, operational, position of the business. I’ve known plenty of businesses that use the VAT they collect from clients in operational cash flow. Then they can struggle when the VAT quarterly bill is due. Those Building Better Business are better prepared.
Recommendation: Ensure all your known future liabilities are already funded or will be, with operational reserves within your business. Check if you are eligible for any grants through your local council or government. Apply for any that are available to you.
Consider how long you need the business to be able to survive in a crisis to be sure that it will be sustainable.
Building Better Business isn’t just about Building Better Business finances. Yet, without good financial management, it’s just not possible.
If you would like to be Building Better Business book a call with me by clicking here…