Never a truer word spoken by the wonderful Mark Bouris. As a business owner, I think we all agree that we have had a wake up call this year. Some of you may have lost businesses, some may be thriving and some may be gasping for air but are going to survive. Which ever you are I hope you have learnt lessons along the way.
For me, I don’t personally think about the value my business may be worth. Don’t get me wrong, I know it is a decent amount, but it is not money that is in my hand and that I can physically touch therefore if it was to disappear tomorrow and I had to go find a job, I would be fine with that and would live to see the silver lining and the positives in the situation. Because I am that type of annoying person that sees the good in even a bad situation.
However, building your business for disaster is a good idea and the sensible part of my brain says that I should protect what I have should life throw us another curve ball. Having gone through two dramatic market changes in our business in the last 15 years, these are my tips:
1. Little expenses add up to big amounts. Not one to normally worry about the smaller bills, however they do accumulate to be a large chunk of money each month. Make those cost savings earlier rather than later
2. Check your own bills before submitting them for payment. Quite often if you have a general manager or someone who does not have a financial interest in the business they are not always frugal enough to question an unnecessary expense.
3. Three things to monitor each month – how much in, how much out, how much due
4. Know your numbers, make sure each portfolio/department is performing. Don't be afraid to re-structure.
5. Check how many subsriptions your are paying. Ensure you are using at least 80% capacity of each app and program otherwise get rid of it
6. What is the back up plan ? During Covid I had 4 stages to implement if needed. We only got to stage 3 and didn’t need to do any more thankfully, but we were always planning for the next step so we were ready.
7. Make tough decisions early. With COVID we forecasted what we thought the next few months were going to be like and made tough decisions with staffing before we noticed the financial impact. If we didn’t we would have already been a month behind with declined finances. As a result, we were fortunate enough to be able to reimburse all our staff the temporary shortfall they took for that brief moment and everyone continues on full pay and full hours.
8. Free marketing – start looking at free or low cost marketing options.
9. Look at your P & L. What are the highest expenses. Find a similar business where you can compare to see how you are running. I do this every month with business friends.
10. Don’t run personal expenses through your business. Good businesses before COVID will be good businesses after.