Do THIS to make your business financially resilient [1/3]13th May 2020
Here’s a thought experiment.
What if your bookkeeper or accountant had suddenly been unavailable, during the first month of this Coronavirus crisis?
Perhaps they were stuck abroad, and just couldn’t get home…
Maybe they had a terrible Internet connection, and couldn’t manage to work remotely for more than an hour or two each day…
Or perhaps – worst case scenario – they were amongst the many people who caught the virus, and were too tired and ill to work for several weeks.
How would your business have coped?
Would you have managed to process payroll, issue all your invoices, pay all your bills, manage your cash flow – in short, keep your business running smoothly?
Or would there have been total chaos, as you realised that there was no one else who knew how to perform any of those tasks, or indeed access all the necessary platforms and information from home?
Who would have struggled to figure it all out? How much time would it have taken? How would your staff have reacted when their salary failed to materialise, day after day….
…And how desperate would you have felt, as the invoices you so urgently need to send out were delayed – yet again?
Of course, that’s just the day-to-day tasks. Someone would also have to manage a Coroanavirus-induced drop in revenue and customer cancellations, and put together a financial plan to survive the coming months….
The truth is that most businesses would be thrown into severe crisis if their accountant or bookkeeper were to suddenly disappear.
The financial repercussions could last for months. Many businesses would not recover at all.
And the damage to your relationship with staff, suppliers and clients could be long-lasting, too.
It’s important that you are 100% confident that, under such circumstances, none of this would come to pass for your company…
…Because this crisis is far from over.
Not only are we going to be handling the economic and social consequences for many months to come, but there is every chance that there will be new lockdowns in the future.
Everything we’ve just been through may very well happen again, as new Coronavirus peaks occur.
And times are going to be very tough, regardless.
Your business needs to be financially resilient, to survive all this. It’s no longer good enough to operate smoothly when times are good.
If the past two months have shown us anything, it’s that you must be ready for bad times – especially when you can see bad times coming a mile off.
Now, in order to be financially resilient, there are three steps you must take.
The first is to ensure that you are not reliant on any one individual to manage your finances.
As you’ve just seen, when you rely on a single accountant or bookkeeper, you place your business in existential danger – no less.
The same is true even if you have a small financial team, but one individual has unique access to crucial knowledge, platforms or spreadsheets.
You need to have very strong financial systems and processes in place, so that if your accountant wasn’t around for any reason, someone else could still pick up their workload – completely effortlessly.
Everything that needed to be done would be laid out clearly – it wouldn’t just be stored in someone’s head!
That’s how larger businesses operate, and yours cannot afford to be any different.
You will also be more resilient with a financial team in place, rather than any single individual.
This will vastly reduce your risk if a key member of staff is unavailable.
But it also means that you are less at risk of fraud. Plus, you will have a broader range of skills available to you – which helps inoculate you against financial failure.
I mean, which type of business do you think found it easier to get through the current crisis?
The ones with a single accountant trying to manage all the regular financial transactions, whilst figuring out how to access government loans, the implications of furloughing staff and trying to put together an emergency financial plan?
Or the ones with teams of bookkeepers, and junior and senior accountants who could not only divvy up these tasks between them – but who had different financial experience and knowledge to bring to the table?
I’m betting on the latter. And so should you.
If your financial management is leaving your company exposed, you need to sort this out quickly.
We work with companies turning over more than £1 million a year to implement all the financial processes and systems you need to operate smoothly - under all circumstances.
You’ll be able to stop fighting financial fires, and instead plan your finances carefully, so that you are better protected during any upcoming crisis – and can scale more easily, too.
When you work with us, you get access to an entire financial team, not just one person, giving you an additional layer of safety, and extensive capabilities usually accessible only to corporates.
Just get in touch today to discuss how this can work for your company.
Let’s give you the resilience you need to get through any crisis – and then the financial tools to thrive and grow.
PS. There are two other key steps to make your business more financially resilient. I’ll discuss the second one next week – watch out for that email!
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