Women Career and Education

Whatever your business or specialism, whether you are in mail order, direct mail or a small or medium sized on or offline business, it is important to know the strategies for keeping your business alive so that your business survives economic recessions, peaks and troughs in market trends, external competition, changes in legislation. At any point where the cash flow in the business, whatever its size starts to diminish the money management of the business needs to be scrutinised and managed tightly.

Some of the things that you can and should do to protect yourself from unnecessary expenditure is to prioritise what is essential for the survival of the business. Lets face it we have all made purchases based on emotion and sudden impulse, bought things that we did not really need, been responsive to the flamboyancy of the advertising salesperson. A few hours later, or even a day or so later, we realize that we have committed hundreds of dollars of business funds for an item or service that is not essential to the success of our business.

It is important to have a company action plan to ensure the survival of your business, some companies set up advisory boards or have a network of outside professional people sometimes known as a power circle which will act as an advisory board during times of difficulty. It is important to hire an outside accountant or accounting firm to figure out key cash flow information like return on your investments, turnover of your accounts, debtors and creditors and ways to keep expenditure to a minimum. A board such as this should meet once a month and present reports and financial analysis for the business. If you are a sole proprietor the board may be just made up of yourself and your accountant, for limited companies this could be the company directors, the company secretary and accountants. Whatever your structure it is essential to keep your hands on the wallet of your business!! No formal decisions need to be made either at the board meeting or as a result of them, but the meeting will provide a great deal of information and action plans which you can use in your business.

Credit control is essential to the cash flow of the business and is often overlooked, many businesses concentrate in generating new sales which is great, but if there is no money in the pot to finance the man power, the purchases needed for the business, etc then the business will not survive for long, therefore it is a necessity to ensure that your customers are paying their accounts on time, if not, you need to speak with these people, and follow a strategy and action plan to ensure that debts are paid to you in a timely manner. Do not be scared of the telephone, talking to your customers is essential to any business, if you can work with your customers and work out a payment plan then that will benefit you both. If you do not speak to the customer, you cannot find out what the problem is - maybe they were not happy with your service or product, maybe they cannot pay, whatever the reason unless you speak to them you will not find out why the have not paid and there is more chance that the payment may take longer to come than if you had spoken to them, or it may not come at all!

Other things to consider:
Know which direction your business is going, have a 3/5/10 year action plan, be aware on a day to day basis your progress, be aware of your competitors and understand what they are doing, practise good money management.

In order to survive with a small business, regardless of the economic climate, surround yourself with smart professionals and practise sound business management at all times.