With a new President-Elect taking office on Inauguration Day, businesses and citizens across the country are holding their breath. How will Donald Trump shape the economy? Will his policies help bolster the working class? Will industries suffer or rise? And what about consumerism? Will your current buyers remain financially stable enough to continue supporting your business?
Uncertainty is an exasperating period of time for most business owners, but there are some smart steps you can take to ease your nerves. Remember, in business, it is always best to prepare for the worst while you hope for the best.
Here are 3 tips to help keep your business secure through a potential economic crisis.
#1: Tighten Your Budget
During uncertain times, it is important to make your first financial changes on your budget. Managing costs is essential, but it is no easy work. How much profit are you making? What are your current losses? Is there anywhere you can cut spending? By answering these questions, you can better predict your financial forecast. Adjust your budget to ensure a safety net in case times get tough.
#2: Assess Your Cash Flow
One of the first signs of an economic crisis comes when consistently on-time paying customers are suddenly making later and later payments. This will undoubtedly affect your cash flow, and poor cash flow is one of the top reasons businesses fail. If you do not already know where the majority of your money comes from and where it goes, you want to start tracking those numbers.
#3: Get Paid: Quick Working Capital
As you prepare for the worst, it may be wise to update your payment policies. This could be done by revisiting your current business deals and requesting money upfront, implementing late fees or offering discounts to pre-paying clients, or by working with a factoring company.
A factoring company will purchase your accounts receivables every month for a small fee. In doing so, you gain quick working capital, you increase cash flow, and the factoring company takes charge of the bills. This is a great solution for managing cash flow and increasing in-office productivity.
Contact Porter Capital Today
If you have concerns about the financial state of your company, it is important to take the necessary steps to protect yourself. Porter Capital will work with you to provide the quick working capital and financial solutions you need to stay afloat. Contact us today.