Covid-19 has impacted every part of our society and business and it has changed a lot about how we all operate, but there has remained one constant throughout: Cash Is King.
In many ways we have been fortunate, the British Government has made considerable efforts to help individuals and businesses, most have been able to benefit from the government schemes but sadly there were a number of small, limited companies that fell through the gap. Whatever your business set up, there are a few ways to future proof your business and not allow recent events to stunt your ability to grow.
This is a perfect time to invest in new technology. Not only will it enable you to offer a more efficient and reliable service but investing in certain pieces of kit can reduce staff levels. Look at the technology that will help your business and don’t be afraid to make tough decisions for your survival.
Hire is always a good option to consider. If you have short to mid-term contracts you might not want to commit to buying new equipment so look at the costs of hire vs purchase. Hire per month may be more expensive than a lease, but unused equipment sat on a shelf is a very unnecessary expense. It may be that a combination of the two will work for your business, it doesn’t have to be one or the other.
The new car market has been one of the biggest commercial casualties of the Covid crisis but out of every crisis comes opportunity and if you’re due to renew cars or vans, there are some amazing deals out there – even if it means taking a vehicle early, you can get a lot for your money at the moment. Now is definitely the time to review your fleet – however big or small.
Keeping cash in the business is important and the Bounce Back loans are an excellent way to boost your cash position. With no payments for the first twelve months, this is the cheapest, readily available cash I’ve ever known to be made available but there is a deadline. The facility is removed on 4th November 2020, don’t miss it! It allows you to borrow up to 25% of your annual turnover (max £50K), you may need this to fill gaps left in the wake of the last few months or you can use it to invest in the business and kick start your growth.
Also look at alternative finance companies such as Latitude Leasing. We are here to help SME’s and understand the impact of Covid but also can take a common-sense approach to fund new equipment and will build schemes to suit your business model.
It might sound counter-intuitive but if you have customers on your sales ledger that pay way beyond terms and on a tight margin, think about saying no next time they offer you some work. The time spent chasing invoices and the gap it leaves in your cash flow quickly eat into any profit. Focus on doing the best job for the clients you know will pay.
There are many other steps to take but the aim should be to create both liquidities in the business and time to manage it going forward.