Know Your Expenses: How Can You Improve Your Business Spending
When was the last time you did a comprehensive review of your expenses? From your rolling cash flow forecast, you will now have insight on your expenses, giving you a chance to look at each with fresh eyes. If you have contracts for supplies or services, can you negotiate better prices or terms? A crisis, it is said, brings everyone back to the negotiating table. Look at your agreements and see if there is room to gain an increased margin if you pay in 25 days? Contact your suppliers and see what is most important to them. Have you had a supplier that you’ve been less than happy with, but there hasn’t been a good time to find another? Now is the time.
Know your Revenue: Take a Hard Look at Income, Profitability, and Growth
The rolling forecast will also give you great insight to your revenue sources because it tracks trends, payment issues and vulnerability. If your business is curtailed or shut down completely, will those revenues return when you reopen, or are they gone forever? If you’ve operated fully during the pandemic, has there been impact to a previously steady revenue source? Do you need to look for an alternative? Everyone has seen the news coverage of closed businesses that transformed themselves to help with PPE manufacturing. A distillery starts making hand sanitizer. A dental company starts making swabs. The crisis provides the motivation to take a hard look at income, profitability and growth.
Know Your People: Are Associates Placed Where They Make the Most Impact?
For business owners, this may be the most difficult deep dive that they do. When it comes to people, we tend to be more subjective than objective, and it often is very personal. Certainly, the most important task is to make sure everyone is healthy, both physically and mentally, and can work safely. After your most important assets are protected, it is time to take a hard look at each associate and decide if they are in the right seat, aligned with their skill set. If not, make those adjustments now Is everyone rowing hard and in the same direction or do you have someone on your team that just messes with the mojo of the entire firm? While making changes during a crisis might not make sense due to continuity and team morale, there is really never a good time and a crisis provides an opportunity for a reduction in your work force.
Find Your Silver Lining and Pivot from Crisis to Opportunity, Setting Your Business Up for Long-Term Growth
Churchill also said that “difficulties mastered are opportunities won.” Yes, this is a difficult time for business owners and we don’t yet know when the pandemic crisis will be over with. If you have the bandwidth to look for your silver lining, you should use it. Many companies will come out of this stronger than before, ready to compete and grow at a pace that was previously unattainable.
At FocusCFO, we’re bullish on American enterprise and will help you find your silver lining. Let’s not let this crisis go to waste.