Less of a pinch and more of a squeeze, you’re not alone if you’re feeling the impacts of the current economic climate. From inflation to supply chain disruptions, the business owners I speak with daily are looking for new ways to navigate towards a more certain future.
It’s not a hopeless situation. There are steps you can take to survive and thrive. Here are five tips to help you gain clarity and shore up your financial position.
- Get to know your numbers
This isn’t the time to bury your head in the sand. If you aren’t across your numbers already, now’s the time to be across exactly what’s happening with your business finances. When you know your numbers, you can identify wastage in your business and spot opportunities to create efficiencies. Your numbers tell a story and it’s crucial you understand them. - Choose your CFO carefully
As a small business, it can be hard to justify the expense of a CFO. That’s why an outsourced CFO service can be beneficial. You get strategic experience with the flexibility and cost efficiency of an outsourced solution. The right CFO – outsourced or otherwise – can tailor a financial plan that will steer your business through the current climate, and beyond. - Take control of your supply chain
Almost no industry is immune from the supply chain challenges causing mayhem on small businesses. While you can’t control the weather, shipping delays or other global events, you can implement protective strategies to manage your situation. If you’re in a position to obtain finance and buy in bulk, this can ensure you have the inventory you need. Your CFO can advise on the best strategy for your business based on your industry risk profile and predicted consumer behaviour. - Consider new perspectives
Sometimes it can be hard to see the forest for the trees when you’re so close to your business. Even more so during challenging times when you need to play a more hands-on role in daily operations. When I speak with a new client, it’s amazing the opportunities we can identify immediately to bring costs down and drive profitability up. - Review your pricing
Setting your pricing is a very fine line to walk, particularly in a tough economic climate. Price too high, and you lose volume. Price too low, and you risk covering costs. If your market isn’t willing to absorb a cost increase, are there input costs you can reduce to raise revenue? Or will a modest price increase help you to gain a bigger share of the market and subsequently higher volumes?
The final word
Even with limited budget and resources, you can take action to cushion your business from economic impacts. The businesses that survive will be those that are proactive. Start today with these simple actions and expand the strategic position of your business.
