Bibby Financial Services’ bi-annual Barometer survey, conducted in February 2013, found that small business optimism is on the rise. Over 25% plan to invest in their business in the coming quarter and 20% intend to buy another business. While it’s an exciting and encouraging time for many SMEs, expansion brings with it higher costs.
Bibby’s 10-point checklist by Gary Green, National Sales Director, outlines how business owners can review their financial position over the Easter break to ensure they can comfortably cope with the coming quarter.
1. Think like the big bunnies
Be open to growth, plan for growth, and growth will surely follow. By having clear goals and objectives, businesses can plan for expansion such as generating more sales or investing more in their business. Our Barometer found that 71% of businesses surveyed are confident about their business prospects in the coming year.
2. Try an alternative Easter trail
Cash flow is like oxygen to a healthy business. If you are stuck in debt, look at other options available. A debtor finance provider pays up to 85% of outstanding invoices usually within 24 hours injecting cash back into your business. This not only frees up time but assists in meeting supplier deadlines, paying taxes and wages, and maintaining a steady cash flow to ensure growing your business remains a top priority.
3. Don’t get left behind by the other egg hunters
A contributing factor to cash flow problems is the length of time businesses must wait to be paid. Thirty-seven per cent expect the length of time to be paid will increase in the coming quarter. It is vital that invoices be issued promptly so they can be paid on time to ensure positive cash flow and provide your business with the nourishment it needs.
4. Think smart about gathering your eggs
Look into useful strategies to manage late payments. The Bibby Barometer found that businesses have adopted useful methods to address slow payments like offering discounts for early payment (24%), or conducting cash flow forecasts (24%) and credit checks (19%). This can improve a business’ ability to pay debt.
5. Throw a new flavour in the mix
An increasingly popular communication channel for SMEs is social media with 65% stating it has contributed to the growth of their business over the past 12 months. Many have been using social media to raise brand awareness, generate new business and improve services. Think about the ways you can promote your business and get in touch with customers via Facebook, LinkedIn and Twitter, and see how many people start talking about your business.
6. Join the Easter hat brigade
Be aware of who your competitors are and the happenings in the market. Read up on industry news while on your Easter break. Be knowledgeable on current issues and noticeable trends.
7. Dare to hop a little higher
Our Bibby Barometer found that 38% of small businesses are planning to take more risks over the coming 12 months. It’s time to take advantage of new business opportunities and think outside the box in terms of further expanding your business.
8. Get your eggs in order
Rather than waiting until the financial year end, resolve to complete your return as soon as you can. To complete your return, your accountant will need full records of your financial transactions, so why not start now.
9. Buy a chocolate Bilby
Don’t let your business become extinct like a bilby. Insure your business by remaining close to your suppliers and customers. Record insolvencies in January 2013 and high profile collapses have plagued businesses this year. Make sure you save your business by focusing on managing supply-side risks and cash flow.
10. Enjoy the festivities
Running a business can lead you through countless hurdles and challenges. Ensure you and your staff schedule in time to re-energise. Enjoy a cup of hot chocolate and a hot cross bun over the Easter break.
Managing these steps are the key ingredients to a winning recipe for expanding your empire.