With a rampant increase in Inflation topped with disruptions in supply chains, small businesses are finding it difficult to cope & maintain their business.
For many businesses it has come down to times of crisis & even bankruptcy.
There are so many factors which have come together to lead the businesses to this grim situation. Be it the increase in tax, rise in inflation, disruptions in supply chain, rising energy costs …. the list is getting endless.
With the rise of costs of doing business, it is getting more & more difficult to sustain, is the complaint of most small business owners & Directors.
No doubt government schemes during the pandemic have helped many businesses bounce back, but the ongoing issue of inflation & supply chain disruptions are causing havoc for many small businesses.
Lets take a look at some statistics here to get a better understanding.
With costs set to rise even further this year, we explore the challenges companies are facing and the strategies that can help them.
1. Understanding Your Financials
It is very important that as a small business firm you understand the financial health of your business. It is imperative to know & understand where your money is going & what expenses the company is spending.
You might want to analyse the spending habits of the business & incorporate a rational & pragmatic spending pattern. Practicing cost-optimisation strategies will help you save money & utilise the available cash flow efficiently.
2. Go Digital
Wherever possible make the use of digital rather than manual. Just to site an example, you can send business letters as emails rather than by post, saving you money on the cost of paper & postage.
3. Try Do It Yourself (DIY) for Some Tasks
Many small businesses have contracts with third parties to cater to some tasks which probably can be curtailed. In today’s fast growing social media, you can do your own marketing & PR rather than engaging with some third-party. This will help you save some operating costs.
4. Negotiations work Better
It is time that you brush up on your negotiation skills. Most of the time you will see that negotiations will help you save a lot of bucks. Always remember ‘If you don’t ask for it, you will not get it’ So make it a point to ask for a better deal, a better negotiation.
How much ever small the negotiated price or barter maybe, it will save you in the long run.
Afterall, every drop makes an ocean! So, make good each drop, each saving.
5. Reuse & Recycle
You might be surprised at how much you can save just by reusing the recycled packaging material . Wherever possible try to minimise your usage of packaging materials.
6. Halt or Pause major Investments.
With rising inflation & disruption in the supply chain, sustaining a proper cash flow in business is becoming difficult. Even running a business is becoming more expensive. In such a scenario it would only be wise to halt any kind of major investment to save that cash.
7. Take advantage of various govt. Schemes
The UK government has launched different schemes for small businesses to help run their business during the pandemic. I would encourage you to look into those schemes to see if your company is eligible for any of the schemes. The government also has some funding to help small businesses which can be utilised in such a crisis if your business is eligible for those fundings.
8. Update your pricing
Some business sectors might have experienced a VAT change in the past few months. It will be wise in that case to update your pricing accordingly to match the new cost.
9. Look out for alternative delivery methods
Royal mail has increased its pricing, so it might be helpful to look at other options your business might have in terms of delivery methods for business letters & packages.
10. Don’t overpay your taxes
Taxation can be confusing & complicated. So some small business owners might pay extra just to be on safe side. But it would instead be better to get your taxes done by a professional, so you do not end up paying taxes you don’t need to. Do not avoid paying the tax which is due, just don’t OVERPAY your Tax.
So overall these are the top tips from LMS which will help your small business to stay afloat. LMS has always been there to help those small businesses who are going through financial crisis and need to find a way out of it.
We assist companies facing financial difficulties. As a company director feeling under pressure, the speed at which we can help you identify your options is paramount. You may be pleasantly surprised at the alternatives available to you – it may not be the end of the line in terms of your business and the earlier you speak to us, the more we can do to improve your situation.
Our Business Reviews are focused on critical issues and we provide clear recommendations to help your small business from the crisis arising due to various reasons including Inflation & Supply chain disruption.
Feel free to call us for no obligation initial advice on 0161 864 3824 or e-mail: info@landamsltd.com