If you’ve been hiking in the wilderness or simply taking some time out from the news, you may have missed that we are currently experiencing challenging trade wars. Otherwise, you will all know that the USA has imposed trade tariffs on most countries worldwide, including ours. This has contributed to the fact that the economic conditions are getting tougher out there.
At home, our Prime Minister is committed to pursuing a balanced trade policy with the US while also considering state interventions to support struggling businesses. We’ve noticed significant downturns in the stock market since the weekend because the markets are finding the imposition of Trump’s tariffs difficult. Markets generally don’t like big change!
These developments can be unsettling for us, too, as we all have a vested interest in the markets, directly or indirectly. This situation can lead to many “what if” scenarios if you are a business owner, causing uncertainty.
What does the business landscape look like right now
April was already going to present financial challenges, particularly for employers. This is mainly due to the increase in Employers’ National Insurance contributions and the rise in the minimum wage.
The UK was already facing slow economic growth alongside persistent inflation, which can be overwhelming. All these factors combined can make running a business tricky. As a business owner, you can feel isolated and unsettled during uncertain times.
Remember, you are not alone in this journey. It’s essential to take proactive steps to understand the direction of your business and, more importantly, to focus on the aspects you can influence. You must also get the right professional help at the right time. Together, we can navigate these challenging times with resilience.
Call your regular manager now to discuss how we can help you if you are concerned about your business.
What measures can you take to protect your business?
A survey by the Federation of Small Businesses (FSB) in 2023 found that 60% of small business owners identified cash flow challenges as their top problem when facing difficulties. This continues to be true now.
You need a well-defined cash flow strategy to navigate this period. FSB has previously stated that small businesses also find it harder to secure loans, so spare cash may not readily be available. Should you need some working capital funding or for investment do speak to us. We can point you in the right direction.
With these thoughts in mind, let’s look at what you can do and control to ensure success:
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Quick invoicing
To ensure your customers can pay you, sending your invoices promptly is important. Make sure your invoice includes all relevant details, including your payment methods. Whenever possible, simplify the process for your customers, which may involve accepting credit card payments.
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Chasing Debts quickly
Once you have issued the invoice, it’s crucial to ensure timely payment. Products like Chaser should be the cornerstone of your debt collection policy. We have been using Chaser ourselves for some time now and are huge fans of it.
This tool allows us to automatically send emails to remind our clients when a payment is due and when the deadline has passed. If you would like to explore this product further, please call your usual manager, and they will be happy to assist you.
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Do your bookkeeping regularly within a cloud software
The era of spreadsheets and manual record-keeping is long gone. This method is not only time-consuming but also susceptible to errors. Utilising software like QuickBooks, which we are well-acquainted with, can save you time and provide you with quick access to information, enabling you to make informed decisions. In challenging economic conditions, it’s crucial to stay on top of your data.
You don’t need to be afraid of transitioning to cloud bookkeeping software because we are here to help. We can also take over your bookkeeping completely so you can focus on your business.
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Cut costs but without compromising service or growth
When considering cost-cutting measures, it’s important to be realistic. While examining every expense to eliminate waste is wise, you still need to focus on growth, even in challenging economic conditions. Don’t compromise your strategic path to growth; always keep your goals in mind.
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Up-to-date financial data
How often do you review your data and management information? It’s essential to do this at least quarterly, but ideally monthly. Merely examining your annual accounts once a year is not sufficient in today’s economic climate. You need to stay informed about how your business is performing regularly. Partnering with accountants like us can provide significant long-term value in this process because any problems are picked up quickly.
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Cash flow forecast
Failing to plan your cash flow effectively can lead to costly mistakes. Many businesses operate based solely on the amount available in their bank accounts. Without a cash flow forecast, you might be navigating your finances blindly.
A well-structured cash flow forecast allows you to identify areas where you need to cut back, negotiate terms with suppliers, and review your debtors and customers, among other things.
We are passionate about cash flow forecasting and are dedicated to helping our clients succeed.
We are serious about you and your ambitions. We are trained accountants who work with a variety of businesses and individuals, including the self-employed and landlords. If you are facing any fears or uncertainties, please call us.
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