Keeping a business afloat is already challenging enough. But with the pandemic hitting the world in every way you can imagine, numerous companies and businesses had no choice but to shut down temporarily. Some were even forced to close their doors for good. Others may have decided to keep operating but only with limited finances and resources during such uncertain times.
And now that industries are slowly getting back on their feet, there comes another challenge: to rebuild business finances post-pandemic. A consistent cash flow is critical if you want to continue running your business, and if you don’t have enough resources at the moment, rebuilding it can prove to be a struggle. Having a firm recovery plan in place can significantly help make sure you’re on the right track.
Here are some steps you can take to get back to a smoother cash flow and rebuild your finances in the post-pandemic era:
Seek Professional Help
While it’s practical to do things on your own, especially if you have a limited budget, you should also consider it carefully if doing so might do your organization more harm than good. Some businesses fail because of poor financial management and decision-making, and you don’t want the same to happen to you. Seeking professional advice and help when it comes to finances might be something you want to think about seriously.
A sound financial strategy doesn’t only involve working on your budget or capital. There are also the aspects of bookkeeping, accounting, financial projections, checks balancing, and systems analysis to ensure that the financial side of the business is well taken care of.
Hiring a reliable chief financial officer (CFO) might be a brilliant idea if you want someone professional enough to take care of those things. If you don’t think hiring one is a wise decision, you can look into outsourcing CFO services to guarantee that your rebuilding efforts won’t be put to waste.
Assess The Damage
Should you decide to tackle the challenge on your own, you need to thoroughly assess the damage that the pandemic has inflicted on your business, financially speaking. Doing so will give you a better perspective of what you need to work on and how you should go about rebuilding the said damage. Start by updating your financial statements so you can compare them to the previous ones. That way, you can have an idea of how bad it’s been for your business.
Make sure you involve all aspects in the assessment and not just financial statements. If you had to let go of some of your employees, that should be accounted for as well. If you’ve made significant reductions in your marketing and advertising budgets, include those, too.
Decide If You Need More Funding
Once you’ve assessed the damage and you already have at least a rough estimate of how much you’ll need to rebuild, the next step is to figure out if your cash at hand will be enough for your plans. Do you need more resources to fund your new methods and projects? If so, now’s the time to figure out where you’ll get the money you require.
You can check the different programs of the government that offer loans and resources to business owners who need them. There are also short- and long-term financing solutions you can opt for from private lenders and commercial banks. Should you decide to take advantage of those offers, make sure you prepare the necessary documents and evaluate how much you need to jump-start your rebuilding plans.
Set Up A Contingency Plan
If there’s one thing that the pandemic has taught everyone, it’s the necessity of being prepared all the time. Businesses had to learn this lesson the hard way, so it’s better if you’ll use the experience to get better should a crisis arise again. Developing a contingency plan will significantly help in keeping you vigilant and prepared at any given time.
For example, if the pandemic shook you in a way that you weren’t able to prepare enough liquid cash, that should be a lesson to always set aside extra money for business savings so you have something to turn to when you need more funding. Limiting your debts can also be another approach to limit or reduce your financial responsibilities. Another thing you can do is to ensure that your employees are trained to face such crises so the organization won’t fall apart again.
Revamp Your Budget
Although it’s a post-pandemic era now, the damage you’ve had to deal with can still impact your business as you prepare to exit the crisis. That said, revamping your budget is essential to account for other expenses you need to prepare for as you get on with the new normal.
One consideration is the necessity to hire and train new employees if you need more people. You also shouldn’t forget the added expenses for new health and safety protocols the government or regulating boards require, especially if you’re in the food and beverage industry.
And since you’re working on rebuilding your finances and the business as a whole, it might also mean having to increase the budget for marketing and advertising in order to spread the word about your reopening. Look carefully into each component to avoid unnecessary spending. The key is to allocate your resources to departments that need them to keep the business going.
In Conclusion
Perhaps one of the most challenging aspects of running a business is to ensure consistent cash flow and revenue. When the pandemic hit, it’s no secret that every business and organization was deeply impacted. Now that it’s time to slowly but surely adapt to the new normal, rebuilding your business finances is a task you must see through till the end.
Hiring professionals who can help you out is worth considering. That way, you can avoid committing budgeting mistakes. It’s also crucial that you know how to assess the damage that the pandemic has inflicted on your enterprise. From there, you can decide whether or not you need to look for more funding sources to get your business up and running again. Revamping your budget is also another aspect you shouldn’t forget. And lastly, setting up a contingency plan can significantly help prepare your organization for any unforeseen circumstance or crisis in the future.
Jason is the Marketing Manager at a local advertising company in Australia. He moved to Australia 10 years back for his passion for advertising. Jason recently joined BFA as a volunteer writer and contributes by sharing his valuable experience and knowledge.
Leave a Reply