The strength of your business is being tested to its limits in 2020. But even so, there are significant lessons to be learned from this crisis. In order to survive, you and your business need to adapt faster than ever before. It’s time to ditch out of date business functions, adopt cloud technology, and get serious about budgets.
In this post, we’ll share our most critical financial advice for surviving a crisis, so you can come out the other side prepared and ready to take on whatever comes at you next.
1. Get Serious About Budgets
Budgeting may not be the most exciting aspect of running a business, but there’s no doubt that it’s one of the most necessary. The Covid-19 crisis has shown how important it is to know where you stand financially so that you’re not caught completely unaware when something doesn’t go the way you expect.
Take budgeting and financial planning seriously, and get into the habit of reviewing and understanding your monthly financials. Think of your financials and KPIs as your car’s dashboard—the speedometer and gas gauge. Your budget is your GPS. When you’re driving, you need to keep an eye on all of them to safely reach your destination.
Know where you are, how fast you’re going, and what you should expect en route. Being diligent about budgets from here on out will help you reach the other side of 2020 all the stronger.
2. Prioritize Cash Flow Planning
Managing your cash flow is essential to your business’s survival. When a crisis hits and your business is cash poor, you can’t pay your rent, you can’t pay your employees, and you can’t pay yourself. If the crisis stretches out more than a few weeks or months, it could mean the end of your business.
Creating a cash flow plan may seem daunting initially, and you may resist it for fear of finding out how little cash your business really has on hand. But that fear will only grow the longer you wait to create a plan. A cash flow plan will take that uncertainty and fear out of your mind, so you can begin to prepare your business for unexpected scenarios. The more preparation you take now, the better you’ll be able to weather any storm that comes your way.
Learn more about Cash Flow Planning for Businesses in the Midst of a Crisis.
3. Ditch Desktop Software and Embrace the Cloud
Accounting technology has significantly improved. What was traditionally done on paper with extensive physical filing systems can now be completed digitally and stored in the cloud with secure access for anyone who needs it.
With the cloud, every document you need is one button click away. Plus, cloud technology makes it all the easier by ensuring no one is tied to a physical location. The necessity to work from home has suddenly become a reality for many businesses, and the speed with which it’s happened might still have you reeling. Hopefully, you’ve found that there are all sorts of cloud solutions that can improve your business functions. Take these tools with you into the future of your business.
Cloud technology is efficient, time-saving, and provides more flexibility to your team. Embracing the cloud allows you to work with outsourced accounting experts and bookkeeping services in minutes without needing to physically operate in the same space. Online budgeting is easier than ever before, so there’s no excuse to ignore your financials. Cloud tools are quick and reliable, providing you with instant financial information critical to decision making.
Like it or not, operating in the cloud is the future for businesses that want to continue working during unprecedented times. The sooner you embrace the cloud, the better. Don’t let your business get left behind.
5. Adapt or Be Left Behind
Change isn’t a possibility—it’s a guarantee. The fate of your business relies on your ability to adjust to evolving circumstances. Many businesses and organizations do a fine job of planning for the expected. But when the world throws you a curveball, your success is determined by your ability to adapt.
Being adaptable means you don’t have to be afraid of the unexpected, as you’ve already planned for it. It doesn’t mean predicting the future. It’s the ability to adjust to new conditions or circumstances. Learning to adapt means creating multiple plans for multiple different futures.
If you remain stagnant, your business will be found unprepared when crisis strikes. Don’t resist change. Learn from it and grow with it. Steadily adopting emerging technologies in every aspect of your business ensures your company is always adapting, learning, and growing. You’ll be ready for whatever life throws at you.
Element CPA Can Help
Don’t wait until it’s too late to take a deep look at your finances. Budgets and cash flow planning are not a one-time exercise. They should be evaluated and monitored on a regular basis to ensure business survival.
We’re here to help you ride out this storm and any future bad weather that may come your way. Reach out to Element CPA for a discovery call to assess your financial situation. We can provide your business with the financial support you need, wherever you need it most.
Contact Element CPA to book your discovery call.