Whether you’re a big multinational competing at the highest level or a small start-up beginning your business journey, every firm knows that it has to pay close attention to its finances. If you manage your money poorly then failure will always be around the corner and there’s no room for sentiment in the world of business.
So, what can you do to make your financial outlook rosier? Here are five tips which should improve the picture for your business and help to strengthen your chances of growing and flourishing.
Spending audit
The most important thing to do right away is to have an audit of your finances.
Go through your accounts, look at what you spend every month and ask yourself if you’re getting value for money – whether that’s an energy bill or the amount you pay to a regular supplier. If you feel that you aren’t, try to reduce these bills by asking for a reduction or shopping around. Every reduction in spending will help to free up cash and help your budget go further.
Be forensic and ruthless and reduce your spending burden.
Security
Every business has to consider security. Whether it’s a break-in or an online virus, the actions of criminals could leave a business with a big bill to pay out – both in the short-term as they recover and the long-term as they face up to any reputational damage that is caused. This means that security should be in your thoughts for every aspect of the business in mind, from the way in which you make payments to the software you have to protect sensitive data.
A safe business will have less risk of losing money and, therefore, an improved financial outlook in the long-term.
Lending
Businesses need to decide how they are going to achieve growth in the most financially beneficial way. Most businesses can gain from borrowing, providing that they are able to borrow the right amount of money on favorable terms. Traditionally this has meant preparing a business case for a bank or building society but peer-to-peer lending is growing in popularity, enabling companies to source cash from alternative sources.
The right investment from the right source is an important part of the process of boosting a business’s finances.
Marketing techniques
How do you tell other people about your products and services? Marketing is vital for businesses if they wish to reach out to new and existing customers, and can make a real difference when it comes to finances if it secures greater revenue. Businesses should regularly review their marketing efforts and need to make sure they are making the most of the opportunities provided by digital and social media, for example.
Plan for growth
Finally, you need to have a plan for the short, medium and long-term future. Set out clear financial targets and regularly assess your progress towards these. By having a clear idea of where you’d like to go you can manage growth sensibly – without taking on too many staff and costs, for example – and step in to fix issues as and when they arise.
Review your spending, keep an eye on security, find the right sources of finances, market your business smartly and have a thorough plan for growth and you should improve your business finances for the future.