It’s been a tough year for business. Many have had to make people redundant, some have had to sell premises while others, unfortunately, haven’t quite made it and have gone bankrupt. It’s left business owners scrabbling for anything they can do to shield themselves for the economic shockwaves caused by the pandemic. Certain industries have been hit a lot harder than others, such as the tourism industry, restaurant and hospitality in general.
Businesses have grasped for more sales while trying to keep overhead down and ensure they can come out of the crisis ready to trade back to normality. It’s harder for some than others, however, because of budgets and their market position. A business who has a lot of cash reserves has a better chance of survival than one without, for example. Here are some top finance tips which could help your business save a bit of money and survive for longer.
Reassess Your Supply Contracts
If you’re in any kind of shop front business, or run an office, or manufacture products or components, you’ll have suppliers. This may even apply to those running service based businesses. If sales have dipped and you’re in a pinch, reduce them. If you need something, make sure you put the effort in to get the best possible price. This can range from contacting your authorized office printer dealer for a better price to focusing on reducing the amount of stationary or paper you procure. Be polite and professional. They may be going through a hard time too but might agree to a reduction until things get back to normal. They won’t won’t to lose a long time business contact. Once you’ve reassessed your supply contracts you may have a little more liquidity, depending on how much you rely on suppliers.
Know What’s Available to Your Business
Make sure you take the time to sit down and do some research because there may be certain grants or deductibles available to you as a business owner. For example, if you’re in the UK, there are grants to help businesses impacted by the coronavirus pandemic. You won’t get these if you don’t know about them so make sure that you at least are in the loop. The money can help you pay wages and survive that little longer. It can help you market your business elsewhere or transfer from a physical store to an online one. But, you won’t be able to do this unless you know it exists. If you’re worried about missing something, you could use a financial advisor who would likely know exactly what you can claim. Or, failing that, a tax specialist. However, they’ll cost you more money so do some research and be careful. It all boils down to how much time you have vs the money at your disposal.
Cut Overhead Entirely
This can be pretty tough to do, and some businesses won’t be able to do it at all. Cutting the overheads is a massive way to save on cash, and the best way is to forgo your premises. This will only work if you’re a service-based business, or a product-based business which only operates online. Think of the rent, or the mortgage. Then think about the building insurance etc. Go mobile. Enable your workforce to work from home full time. It’s the future and the way to go. Imagine you were allowing home working before the pandemic. The transition would have been pretty smooth. When everything blows over you can go back to working in an office if you’d like, but for now, in the short term, you can save a pretty nice chunk of cash.
It might be that things have dried up at home due to the current situation in your country, but you’d be surprised but how fluid things were in Asia. It might be that you can do business in Japan, or maybe South Korea or China. Consider overseas possibilities and you may be able to start pulling in money from somewhere else. The issue here is that you need to be pretty damn sure you’ll make the money first because there will be investment needed on your behalf, and even then your profit may be eroded slightly by shipping costs. However, if you’re a service industry the overheads may be low and you’ll find yourself open to a whole host of new clients. Research is the key here.
Sell Elsewhere to Boost Finances
You may sell off your own platform, through the website. Maybe you’ve only ever sold through your physical premises. If your sales have tapered off it might be time to make use of other avenues. Depending what you sell, you should consider selling on Amazon. Just check if what you sell is a gated brand first to make sure you can sell it. Using a third party which is already popular is often a good way to boost your business. You can’t really do this with services though, unless there’s a far bigger business than you doing something similar who you can approach. Just be sure to outline what you can do for them in your pitch process. Again, there are some outgoings to get things set up but they’re certainly worth it if it’s going to bring in money to help your finances.
Don’t Recruit, Use Freelance
If finances are tight, and you feel like you could use a helping hand, don’t be tempted into recruiting someone. Sure, recruitment is a sustainable, and logical way to grow your business but not when your finances are a little stretched. Recruitment equals commitment in the long term. If you can get around this, you can ensure that what you’re paying for work is completely scalable. Freelancers are the answer. You can find them on sites like Fiverr, and Upwork. The benefit of a freelancer is that they’ll be able to do whatever you want them to. They’re already industry professionals and you’re going to benefit from their experience in a sector you may not know much about.