How to Reverse a Downturn in Business
Posted on 25th July 2022 at 09:30
If you’ve noticed a downturn in business, it’s imperative that you respond immediately. Leaving the situation to sort itself out will rarely lead to a satisfactory outcome, as clear action is required in order to rectify the downturn in business and prevent it from happening again in the future.
It may not be due to sales
Sometimes a downturn in business isn’t actually a reduction in sales. Instead, it could be a case of outgoings being higher than usual, resulting in low profits or even negative cash flow. If this is the case, you definitely need to cut costs where possible, which the business advisors and tax planning specialists here at TreyBridge can help you to achieve.
Monitor your cash
It’s very important to remember that not all of the cash in your business bank account belongs to you. Some may belong to creditors (businesses and suppliers that you owe money to now or in the near future) and some will be owed to HMRC when your next tax return or VAT return is due for payment.
This is why every business owner should know their financial numbers, as it helps you to track cash flow. Make sure to ask us about our monthly or quarterly management meetings, which enable you to fully understand where your business currently is and effectively plan ahead.
Remember your overheads
As well as cash owed to creditors and HMRC, there will also be a range of overheads cutting into your profits. Many of these will be necessary, such as commercial rent, wages and business insurance, but there could be some that can either be reduced or removed entirely.
Similar to the way many people have a personal gym subscription that they pay for but don’t use, a business can build up multiple overheads that were once required but are now superfluous. We’ll help you to identify and analyse all of your overheads, followed by tailored guidance on how to minimise them wherever possible.
We understand that a downturn in business can be stressful, which is why we’re always available to help you remain calm and confident by delivering the highest calibre of business advice and one-to-one support.
What’s more, a downturn in business can prove disheartening. You’ll never offer your best work if you’re feeling despondent about the performance of your business, so getting everything in top condition is an investment in smooth service delivery and customer satisfaction.
Don’t bury your head in the sand
If you’ve noticed a downturn in business, the time to act is right now. For proactive advice and support that will help you to strengthen your finances and plan for sustainable growth, call our Northern office on 01482 235575, our London office on 0207 885 0605 or fill in the contact form below.
Tagged as: Business growth
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