3 Ways to Ensure Financial Stability During the Pandemic
While tapping into financial reserves to continue operations has always been standard practice in any business, it has become quite problematic and challenging given the current situation caused by the pandemic.
Many companies have been faced with financial difficulty, forcing them to opt for emergency loans, overhaul existing strategies, and cut back on expenditures in order to stay afloat. In fact, some have already begun to brace themselves for the inevitable recession that is to follow.
Most of their efforts have been focused on making and saving money. After all, failing to do so could potentially put them at risk of closing down.
If you find yourself in a similar situation and are looking for ways to keep your business financially stable during such a tough time, then here are some of the things you need to get done as soon as possible:
1. Update yourself on your current financial position
How are you currently doing financially? Are you still stable, or are you in dire need of help? The only way you are going to know this is to ensure that all your accounting records are in order and up-to-date. Start gathering your paperwork and transactions and start recording. At the same time, check that the records are reflective of what’s really going on.
Once you have gathered all the numbers, you can then go ahead by analyzing the financial statements, from cash flow statements to profit and loss statements. At this phase, your job is to look out for any red flags that can indicate trouble. With that, you will be able to know what to work on to ensure your business stays afloat.
2. Figure out ways to boost your revenue
Without revenue, you are going to be running at a loss. This is obviously no way to keep a business alive, so do what you must to maintain and possibly boost your income streams.
You can do this by increasing your sales or creating new strategies to discover new channels to make a profit. Other ways can also include reducing your expenses with tactics like lowering the use of energy to cut down energy bills. All of these, when working together, helps you continue gaining revenue and improve your bottom line.
3. Eliminate wasted money
Another way you can cut down expenses is by eliminating any discretionary expenses. Sure—they might make your life a little easier and even boost morale, both of which are vital to keep you and your employees working, but what you want to do during this time is eliminate unnecessary spending. For example, you can keep your insurance but can reduce the use of the office coffee machine.
Take your time to identify what is needed and what is not. Remember—every dollar counts towards your survival, so prioritize your spending and trim the non-essentials.
To put things plainly, you need to hire an accountant to help your business make it through this crisis. With their help, you will be able to identify ways to save money and eliminate spending. Plus, they can help you understand how your company is doing financially, allowing you to make well-informed decisions to keep your business going.
If you do not have an accountant working with you yet or you’re having trouble getting your finances together, hire an accountant right away! They represent an excellent investment now, and they will surely remain that way for the years to come.
Do you need an accountant in the Gold Coast to help your business survive? New Wave Accounting can help you get your finances together and grow your business! Reach out to us today.