In the first blog in our ‘Navigating the New Normal’ series, we will take a look at finances, and discuss some best practices for maintaining control in an uncertain economy.
The COVID-19 pandemic has thrust businesses in every industry into uncharted territory. While the world waits for a resolution, it is imperative to adapt to the new normal—especially when it comes to your business’ finances.
Below are 3 best practices for shoring up your finances for the remainder of 2020 and beyond:
Reevaluate your budget
Your business is likely operating under completely different financial circumstances than you were when you outlined your 2020 budget. Now is a critical time to look at your cash flow, cost optimization, and financing options. Reset your financial projections for the remainder of the year and early 2021, carefully considering any short-term liquidity needs that may arise in light of the pandemic. For more budgeting tips, see our recent blog post.
Perform a risk analysis
How will the pandemic impact your business for the remainder of the year? Look at worst case scenarios in terms of client retention, revenue streams, outside funding, and operations, and brainstorm ways to alleviate or offset any potential downturn in these areas. You should also assess your internal controls processes and update them to reflect any changes to your current operations, such as having a remote workforce.
Identify new opportunities
With so many businesses working remotely, there is no better time to take a fresh look at everything from your operations to client services and implement new ways of doing things – and your finances are no exception. Can you implement any paperless processes that will increase reduce inefficiencies and costs going forward? If a portion of your workforce plans to remain remote, can you renegotiate any facility contracts? Are there any new or updated revenue streams you should consider in light of the current state of affairs?
These are just a few best practices when it comes to navigating your finances during the pandemic, depending on your specific business and industry there are likely many other opportunities for cost savings that should be considered. Once you have identified areas where you can save costs, think about how you can utilize those cost savings to transform your business in the new normal.
If you have any questions about your finances or navigating the new normal, leave a comment below, or feel free to contact me directly, I am happy to help.