As we have all heard recently, the UK is officially in a recession. It is anticipated it will last the whole of 2023 and could possibly go over into 2024.
As a business owner, you may start to worry about what you need to do to ensure that your business will not only survive a recession, but also come out stronger at the end of it.
Tips and advice
I started my business in 1999, and so have been through the 2008 recession as well as a few other mini ones. I just want to share with you a few tips that you could consider putting into place now, and over the next few months, to help protect you and your business.
1. Hard work!
Running a business is hard work in normal times, but during a recession it is that much harder, especially if you have staff, as you want to ensure they are in a good position too. Be committed and remember to speak to your accountant, coach or mentor about any issues you have.
Debtors are the people who owe you money. If you do not remind them that they owe you money, they are unlikely to pay you.
Contact your debtors and remind them to pay you. If they are struggling, be happy to accept a payment plan. It is better to have regular smaller amounts than nothing at all.
Creditors are the people who you owe money to. All creditors have a term of payment. Try to adhere to these terms to ensure a constant and good relationship. If you pay your bills immediately, consider using their payment terms to benefit your cash flow. If you are unable to adhere to their payment terms, contact them and arrange a payment plan.
List out all your expenses and see if there are any that you no longer use. Making a cash flow will enable you to see when your dips may occur and allow you to plan your payments in a more structured manner.
Never stop marketing. Some business owners may think they need to cut down on costs and marketing is usually the one to go first. By cutting costs on your marketing, your customers could forget about you and may start to go elsewhere.
You need to remind your customers that you are still in business, let them know what you can do for them, and make sure you are always visible to them. Marketing is the one cost that you must never cut down on, especially in a recession.
Communication is key
You will notice that all the points above come down to the basic principle of communication. At all times, communication is vital to your business.
I hope you find these points of interest and try some out during these difficult times. Naturally, there is no guarantee that all businesses can survive a recession by undertaking these tasks, but every little helps. Always remember to speak to your accountant, coach or mentor for advice.
We are happy to answer questions in future issues. Please send your questions through the Contact Us page on our website.
Chantal Baker, is the director and founder of Champ Consultants Ltd, an accountancy and tax consultancy practice in Caterham. Please follow us on our various social media channels.
I have set up a Facebook group which I invite you, as a business owner, or a potential business owner, to join. It is there to help you grow your business and provide you with tips and advice. Search Facebook for:
Growing Businesses – Tips, Help & Advice.
Find my other useful finance tips here.