Running a business can be stressful, messy, but also very rewarding. Sometimes unexpected challenges come that can cause debt problems. Before the debts snowball out of control, it is important to take stock of what is going on and try to get yourself back on track. Latitude offers debt consolidation, which could be a way to improve your finances and get back in the black.
The best way to tackle finances is to take a look objectively, with everything out on the table. Perhaps you need to make a few difficult decisions or cutbacks to improve the balance sheet.
Let’s take a look at how you can improve your business finances and stay on track with your business.
Document Everything
Maybe you’ve become a little bit lax on entering all the incomings and outgoings. The best way to get back on track is to know where every bit of income is going. This type of meticulous detail does not come naturally to everyone. Build a habit of writing everything down by the end of each workday. Then schedule time once a week to look over each day’s activity.
If you’ve hired someone to do your finances for you, this just means that you will be checking in on their work. Just because you aren’t entering the numbers each day doesn’t mean that you can leave them to it. A good business owner is involved in all aspects of their business, especially the finances.
44 percent of Australian businesses failed because of poor strategic management, and 40 percent did not have enough cash flow, according to a 2011-2012 report from The Australian Securities and Investments Commission. To avoid these dire statistics, take control of your business before it’s too late.
Go With The Flow
In this instance, the idea of “go with the flow” does not mean stay complacent or relaxed about your business. Instead, look at what is going well or what may need adjustments in your business. The economy and customers can fluctuate so evaluate what is working and flow towards a better business model as you move from new business to a more experienced owner.
Analyze if your customers are waning or certain products aren’t leaving the shelves. Maybe it is time to offer a new incentive or try a different approach to get the customers to return. There is always something that can be improved upon in any business, especially with technological advances, internet advertising, and social media. Be open to trying an innovative concept to improve your business model.
Plan and Adjust
Maybe you started with a solid business plan and have continued on the same path since opening. A business plan is not as static as the name suggests. The best idea is to be constantly adjusting and reevaluating your plan, according to entrepreneur Tim Berry. While you should, of course, schedule an annual evaluation, a quarterly and monthly one will be helpful as well. This keeps you aware of what is working, what needs adjusting, and what needs to be discontinued.
Adjustments may need to come in the form of changing your personal lifestyle in order to help the books get back in order. Scaling down living expenses is possible for most people. It may be inconvenient but necessary. Decide if you may need to downsize your house or only have one car and live closer to public transit options. Read a few examples of business owners who went through hard times did just these things to recover their business. If office space rental is at a premium, moving to a less expensive space is also a way to cut costs.
Having a premium serviced office in Sydney CBD may be desirable, but if you can manage with a more cost effective shared solution, or opting for a less expensive location, this can drastically reduce over heads.
Tough Decisions for a Better Business
While it may seem very difficult at the time, making changes, cutting costs, tracking all expenses carefully, and constantly evaluating your business are ways to evolve and improve your finances. Make tough decisions now for a better, healthier business in the near future.
