7 ways to protect your small business
During times of worldwide economic and financial instability, many small business owners can be feeling the pinch of a drop in customers and spending habits.
It is essential to know how to evolve during these times and develop ways to protect not only your business but your employees and your customers as well.
Some ways to protect yourself are:
Understand your financial position
Knowing your cash flow projection for the next 6 months will be essential to staying afloat. Look at potential outcomes where a reduction in income may apply.
Ensure your cash and credit amounts are sorted
Review your planned outgoings for the next few months and focus on eliminating any discretionary spending.
Collect debtors and limit extensions of credit to clients
Be diligent with invoicing and potentially enforce cash upfront from past problem clients. Lack of payment for services during times of economic stress can potentially ruin businesses.
Check your insurance
Many businesses are covered for business interruption insurance, it is important to review your policy during these times to determine your level of coverage.
Review contracts and legal requirements surrounding employed staff and prepare them on the potential scenarios that may need implementation during the shutdown or interruption of your business. Work with staff to arrange different terms to ensure the continuation of employment.
The Australian Federal Government have a number of measures in place to assist those under financial stress during uncertain times. For a rundown of the economic response and measures to the Coronavirus specifically, go here.
Imagine the future
Set goals and a vision for how the business will respond after this hardship. Share these goals with the team to ensure you’re all working towards the same endpoint. Be positive and have a plan for ways to adapt and evolve business practices to ensure your survival.