Business Advice during Tough Times
For a small business owner or entrepreneur, starting a business during recession or growing your business during tough times can be the ultimate challenge. But with the agility, planning and the right resources, tough times may even be the opportunity for your business to spur growth. Business strategies and growth may vary, depending on what kind of business it is, but there are also common denominators that characterize the success of small businesses during rough times, therefore, here are some strategies that may help tide your business through.
Business Budget Reassessment
For small businesses, which rely on credit, managing well costs and expenses through well-planned and well-thought of budget management and its implementation, will be the most important tool for the business to survive during tough times and to continue to grow. To be able to do so, an accurate system for profit and loss projections must be established, as well as forecasting these projections on both short and long term periods.
Since there are many risk factors in maintaining a business, it is also important to anticipate any possible scenario that may affect your business, so that putting up an emergency fund can help you finance your decision to change some of your business applications or operations for your business to be able to survive. The value of emergency fund will be an important fall back tool for your business to continue, especially if you have to necessitate some changes in your business.
Keep always an eye of your cash flow and manage it well, since this is a vital factor to allow your business to succeed and survive. Weighing if an additional capital requirement may be needed for your business, especially during hard times, will be difficult if your cash flow system is not properly managed and accurately accounted; therefore, it is equally important to monitor regularly your cash flow.
Have Updated Monthly Statements
One of the basic must-do in any business is to prepare and review the following monthly statements, which are: balance sheet, profit and loss statements, and cash flow statements. By keeping an accurate account of all the money entering and leaving your business, as well as consulting your budget and monthly statements in case of any big purchasing decisions, this shows that you have succeeded in managing your business at all times.
Improve Billing and Collections by Using Software Applications
To improve your bill and collections processes, try automating your accounts receivables (AR) process, using the appropriate accounting software, and by doing so, you get these great advantages: 1. E-invoicing offers AR departments the freedom to produce both paper and electronic invoice format in order to match every customer preference, 2. Moving from manual to automated invoicing not only increases AR departments efficiency, it can also reduce processing costs by 44%, 3. An e-invoicing solution allows companies to send out invoices as they are prepared in real time, giving customers the chance to immediately initiate their internal payment process and getting you paid faster, and 4. Automatic emails to customers reminding them of their payment owed helps speed up collection times, reduce calls, and improve customer relations.