We met one of our clients last week who was really concerned about a potential 50% reduction of his revenue and what that would mean for his business. We set about creating some scenario planning and then together we went through some results based on 20%, 35% and 50% reductions of revenue. Once we were finished, my client noted that the results were not as bad as he had initially imagined, and he felt quite relieved.
A lot of people would sleep a little easier if they knew what the future might look like, and thought the following information would be good to share this with you during this time.
Putting your business finances under scrutiny can be daunting, but the sooner you do this the sooner you will have the visibility, control and confidence to shift your focus from risks to opportunities.
Here are Five good tactics that Newmarket Accounts has been sharing with clients recently:
1. Get a really clear understanding of the current financial state of your business.
· How has the last few weeks impacted your revenue/leads?
· How likely is it that your current debtors will pay you?
· What are your current inventory levels and when will you need to restock?
2. Update your forecast and if you don’t have one, build one – it’s never been more essential.
3. Review your expenses and distinguish between ‘need to haves’ and ‘nice to haves’ – cut the latter., tough but necessary.
4. Scenario plan – the future is uncertain so it’s critical that you have different plans for different futures (plan for the worst and know your decision trigger points).
5. Take advantage of the ATO’s leniency around outstanding tax obligations and explore payment plan options to help extend your runway.
Please share your knowledge with others if you have additional great steps that you are taking right now to ensure your business has measures in place to navigate the future ahead.
Also to get help with your business and sleep easier knowing that you have a plan in place to ensure that your business is set up for success, please reach out to us as we are here to help you.