In the face of the economic downturn caused by COVID-19, it’s essential to take strategic action to keep your business afloat. While the CARES Act provided some relief for business owners, there are still other ways you can offset the financial burden.
Here we’ve compiled seven excellent tips from our leaders on how you can protect your business through this pandemic. Also, we can step in and be of assistance with many of these too. Please don’t hesitate to reach out to us with ANY questions you may have as you determine if these actions are right for you to take.
7 Tips to Keep Your Business Afloat during the COVID-19 Economic Crisis1. Cash is king.
Point blank, most companies die because they run out of cash. When faced with a crisis, sales and money should be your top priority, after ensuring the safety of you and your team members, that is. How is your cash flow, and what can you do to protect it?
If you’re counting on contracts in the pipeline to close, you shouldn’t. The current pandemic is changing many things in our daily lives, and especially so when it comes to how we spend. If you are refocusing where you spend your cash, you can bet that your customers are likely doing the same.
We can help you by creating a cash flow forecast and updating it as things change. Knowing when and where your cash is coming from and when and where it is needed can help you make critical management decisions.
2. Take a look at recurring charges.
Don’t forget to take a close look at the recurring charges on your credit cards and bank accounts. People often overlook these items. Since you aren’t hitting that “purchase” button every time, it’s easy for these charges to fly under the radar. What recurring charges / subscriptions can you live without right now?
3. Internal controls are critical, especially now.
If you don’t have proper internal controls in place, now is the time. Who has access to the company credit card? Is there a process for purchasing approval, or are employees allowed to spend at their own discretion?
Now would be an excellent time to put purchasing procedures in place, where approval is required for any purchase made on the company credit card. This will help you monitor your expenses carefully.
Cost controls are relatively easy to put in place and are something that every business should have. If you don’t, take this opportunity to start using them. Sometimes people get comfortable when they are not monitored and may intentionally or unintentionally abuse their privileges. Cell phone allowances, car allowances, and things of a similar nature should also be monitored closely during this time.4. Working from home? Don’t let your cybersecurity fall by the wayside.
As COVID-19 continues to spread throughout our country, many businesses are sending their team members home to work remotely. But with social distancing comes new threats of cyber-attacks, security challenges, and IT headaches.
Criminals are desperate and looking to take advantage of your vulnerability. Now is not the time to slack on your IT efforts or to cut costs in this area.5. Get creative and look for efficiencies, everywhere.
There is no better time than now to look for efficiencies in your operations. How can you better streamline your processes? Can you automate some of your repetitive tasks? By doing so, you can free up both time and money for other valuable resources.
Maybe you had to let some of your great staff members go, and now one team member is taking over all of their responsibilities. By employing efficiencies, you can set your team up for success as everyone begins to manage a heavier workload.
Or maybe you were about to finally hire that extra person for your accounting department, and now you can’t. We can help you improve your processes so you can still succeed without that additional person on board. It’s time to get creative.6. Renegotiate unnecessary contracts.
There are ways you can use this economic downturn to your advantage. Take the time to renegotiate bad deals and let go of contracts or vendors who are not serving you. Use your leverage points. People across the country are more open to negotiations now than ever before, so be sure to open that door if needed.7. Talk to your credit card company and utilize your earned points.
Reach out to your credit card company and ask if they can give you some relief on your interest rates or a delay of payment. If you have rewards or points, now would be the perfect time to use those to help pay off your balance before interest rates go back up.
If paying your credit card is not an issue right now, you could also convert your earned points to buy office supplies or other similar items to help offset some of your out-of-pocket expenses.
The MGA Team Is Here for You
Beyond tax deadlines and compliance rules, there are many areas where MGA can step in to help your business through this current economic crisis. We can help you manage your cash flow, asses your internal controls, streamline your processes, and much more.
We know it’s a tough time for everyone. Use this opportunity to dig into your business and find any areas of concern. Then, address those immediately. It will not only help you stay afloat during these hard times, but you will also come out on the other side stronger than before.
For more valuable resources, head over to our COVID-19 Resource Center.