Confidence among British businesses has become increasingly brittle during the last 12 months, as fears concerning future trade and economic contraction have escalated.
In fact, a staggering 73% of UK business owners expect the economic climate in the UK to worsen during the next 12 months, with Brexit at the heart of these significant concerns.
With this in mind, entrepreneurs will need to ensure that their business finances are kept in check as the economy (and consumer confidence) continues to decline. Here are some ways in which you can achieve this:
1. Reduce Non-strategic vs. Strategic Costs
For any business, there are strategic and non-strategic costs to consider. The former often have a direct impact on the profitability of your business, for example, whereas the latter are less influential as they determine how you deliver your products or services. These tend to relate to operations, so by finding ways of reducing these costs you can save money without impacting negatively on your firm’s value proposition.
2. Hold Regular Audits
On a similar note, you can also manage your finances more effectively by holding regular audits. Firms such as RSM offer this service to clients across the globe, with quarterly audits capable of identifying any excess levels of expenditure and securing tax compliance. This not only lends itself to excellent management and accurate financial reporting, but it also allows your business to evolve in line with demand.
3. Consider Temporary Business Solutions
In the modern age, it’s also possible for businesses to leverage impermanent business solutions such as temporary buildings and contracted employees. These options enable your business to reduce its annual outgoings, without compromising on the ability of your business to grow and meet the real-time demand for products or services.
4. Embrace BYOD
If you’re new to the concept of BYOD (Bring Your Own Device), this is something that enables your employees to use their own smartphones, tablets and laptops in the workplace. This reduces your initial outlay as a business owners and negates the need for ongoing maintenance costs, as BYOD transfers these to individual users. You’ll just need to ensure that they’re connected across a secure network, as otherwise you may compromise sensitive customer data.
5. Diversify your Revenue Streams
In addition to managing and reducing costs, increasing revenues is also an excellent way to maintain healthy finances. The key is to achieve this with incurring disproportionate costs, by diversifying revenue streams and establishing relationships with affiliates. You can sell your products through an established, third-party website for a fixed commission, for example, enabling you to sell more while keeping costs at a minimum.