Our economy is forever changing and often times, unpredictable, so we may never know when the next recession comes forward or how long it will last for. Many businesses, especially our local, small businesses, fear that any longstanding recession can place them in the negatives and eventually out of business. Thankfully, there are 8 steps you can take that will keep your business improving during uncertain times.

1.) Take Control of Cash- Cash is crucial to the survival of your business. Collect all accounts receivable, be careful granting credit to new customers monitor all purchases, and pay only those item, which will literally keep the doors open.

2.) Know Your Costs- Understand how much each product or service line actually costs. Don’t sell products or services you lose money on. Having this information will allow you to focus on the more stable and profitable areas.

3.) Produce Accurate Financial Information- Businesses that produce accurate financial statements within 20 days of each month and weekly flash reports have the tools to better manage their business. This information allows you to head off a crisis, better manage your cash, and give you the information to prevent losses.

4.) Listen- Gather as much data as possible by talking with employees, customers, future customers and people in the same or similar industry. You can use this feedback to chart a better and more profit-driven future.

5.) Planning, Goal Setting, Focus- Now that you have gathered your data, it is time to formulate a strategic plan toward success. Always keep in mind that both employees and customers look to you for leadership and it is up to you to provide it. Set a 3 year, 1 year, 90 day, and weekly goals that you will update quarterly. It is critical to stay focused on cash flow while constantly maintaining a secure cash reserve. It is essential never to compromise quality for price and always create value.

6.) Right Size- Eliminate all waste! The three biggest costs in a business, other than product or service cost are: payroll, facility, and equipment. You must position these costs to make a profit at the current level of sales. You must also make sure you have the right people working for the company.

7.) Raise New Cash- New cash can give a company a big advantage, enabling increased marketing and sales efforts, finalizing new orders and facilitating efficiency. However, you only want to raise external cash if you are 100 percent sure you will be able to make a profit.

8.) Marketing Budget- Marketing is essential for a business to maintain its awareness and visibility or grow. Do not waste precious time and money marketing where your target audience is not and use feedback from customers to find where they are. Opt out of costly TV commercial slots, newspaper ads, or billboards; instead use social media platforms your audience is on such as: Facebook, Linkedin (B2B), Instagram, Pinterest, etc. You can also use the social platform’s paid advertising that can offer a low-cost way to reach your target audience. Also choose email marketing and use free platforms such as Mail chimp to stay top of mind or Google adwords to bring new leads to your website.

Operating a small business in uncertain times can be both a stressful and frightening experience for business owners. It is best to have an experienced accountant to help you maintain cash flowing into your business, record and manage accurate financial records, and provide expert advice on the best decisions and budgets to make, so your business continues to profit and grow.

%d bloggers like this: