COVID-19: Effective Strategies For Managing Monetary Resources During A Time Of Crisis
The world is in a state of panic and shock as waves of economic depression hit various parts of the world again. In these trying times, financial planning is a delicate house of cards. One wrong move and the whole house might fall down. Most businesses have been suffering; however, some weathered the storm better than others. But small businesses are the biggest affectees of this economic depression caused by Covid-19.
Accounting Partner offers financial planning services to small businesses, giving them freedom and the liberty to make economic choices most suited to them. It also provides a comprehensive outlook of their overall fiscal condition, both past and present. Examining monetary situations, especially managing cash flow on a daily basis, could be slightly tiresome for the operational minded but when an unexpected crisis hits, it is all hands on deck; And Accounting Partner is here for you as a resource guiding you to safer shores by reassessing your monetary resource management.
Gauge the Before and After of Your Financial Health
While small businesses regularly review all financial agreements to get a clear picture; “now” is the time to optimize your key practices and operations. Though it’s great to be optimistic about the current crisis, when it comes to books, it’s always better to be realistic. There are numerous accounting softwares available which make the entire process easy. Today small businesses need to be more nimble on their decision-making more than ever before. Every financial step should be analysed and evaluated before making a final decision.
Encourage Clients to Pay Deposits
Encouraging deposits is one way of managing cash flows for small businesses. While some clients may not be willing to pay a large sum beforehand, most may agree to paying deposits under a specific time frame.
Keep Cash Flow Separate from Profits
Today small businesses are strongly keeping their cash flow separate from the profits. They are questioning the whys and hows of the incoming cash and where it’s going next. Accounting Partner advises to sell idle assets no longer of use to produce quick cash. While acquiring new customers is always beneficial for small businesses, the old customer base should not be ignored and new schemes should be introduced to keep the consumer happy. “Never rob Peter to pay Paul.”
Introduce Incentives for Speedy Payments
Incentives are disguised motivation to keep the wheels greased and the customer happy. Customers are always on the lookout for discounts and deals. Hence, small businesses easily identify between leads with speedy payments and the ones with slow payments. This makes managing cash flow feasible for both parties.
Introduce Favourable Payment Terms
Vendors may not exactly be enthused to be introduced to easy payments on the terms of the consumer but don’t lose patience. Your vendor should clearly be aware of your expectations and contemplate payment as per contract.
If nothing else works.. Take a Debt
While most small businesses are trying to manage cash flow as efficiently as possible, in these difficult times, a firm can take debt to weather the storm that the financial market has become.
A Few Final Words..
The COVID-19 crisis has toppled the economic spine of the world. While the success of your business may rely on cash flow kept abreast, intelligent cash management may keep you out of a crunch. In such moments of uncertainty, only a reliable and seasoned CFO can help you in keeping business on the right track. Hence, asking for the support and help of the best accounting firm in Canada is all that every small business owner should do to keep operations running and revenue coming.