As we mentioned in a recent Linked In post, the expression ‘Cash is King’ is still as relevant as ever. It may be accused of being overused but the cash is king mantra still holds true, especially for those small businesses approaching the winter crunch.
If you are worried about paying your bills and surviving the difficult Christmas season, it is important not to bury your head in the snow, and instead be pro-active in ensuring the survival and success of your business.
What should you do?
It’s impossible to make a plan without first knowing where you currently stand. As such, your first action should be to fully understand your current cashflow situation. At Moulds & Co we pride ourselves on ensuring our clients fully understand their own finances and understand the value in having an accountant who truly understands their business. Take stock of your current cashflow situation, speaking to an accountant whenever you feel you need clarification or advice.
Once your current situation is evaluated, it is time to look ahead to the immediate future. At Moulds & Co we would recommend a cashflow forecast that covers at least a minimum of the next 6 months.
Once your projection is complete, it’s time to list all the possible steps to make it better. How can you improve on this situation? What changes can be made right now and in the short term? Once you fully understand the situation and have a grasp on your cashflow projections, it’s remarkable how you can begin to make changes and improve this.
How do I make a forecast?
Your main focus should always be on your business, so don’t waste time away from the day to day work by searching for and creating an overcomplicated forecast. A simple, quick and easy projection is all you need to begin with and can really make a difference.
At Moulds & Co, we have a time tested model that we have simplified into an efficient and effective excel template. If you’re worried about your forecast and don’t know how to get started, speak to a member of our team today and we will be happy to send you a free copy of our template.
I’ve made the forecast, now what’s the next step?
As mentioned before, the smallest changes can really build up to make a big difference. Once you have your forecast, it’s important that you fully understand it and create a useful and realistic plan of action. Putting things in order and creating an achievable plan of action for the next 6 months or beyond can give you peace of mind during the winter break.
This is where we believe a good local accountant makes all the difference. In recent weeks, we have had several very rewarding moments with clients who were facing difficulties with their business and have been surprised at the difference that a new perspective and an effective and achievable plan of action can make.