The last 18 months has not been the most comfortable period for small businesses, with many forced to reduce or cease trading due to the nationwide lockdown, and the UK facing a steep economic recovery from the Covid-19 pandemic and the knock on effects of Brexit. For businesses of all sizes, any decline in the country’s economic standing – however temporary – is a concern, so it’s understandable that small and middle-sized enterprises, in particular, may seek to reduce their costs by eliminating external support, such as accounting.
In fact, the spectre of recession makes a partnership with a small business accounts specialist even more critical, to give your organisation the best chance of remaining in a strong financial position. Attempting to manage your own accounts could lead to serious mistakes being made, with the resultant long-term financial damage likely to undermine your business’ survival. Also, allowing your finances to be looked after by an accountant will enable you to concentrate on drumming up new business.
Maintaining Cash Flow In A Downturn
Cash flow in a recession is likely to be your main concern, to ensure that your liabilities can be settled, and staff paid. Restricted cash flow can have serious consequences, however viable the business may appear.
An experienced small business accountant can help you to make achievable plans and have all the information at your fingertips to make informed decisions and to help your business to spring back to a healthy position as soon as possible. Understanding how you can spread payment of tax liabilities, use other financing options and having confidence in your forecasts an accountant can work with you to help you plan a positive cash flow strategy which will allow you to consider continuing to develop new business through cost-effective marketing, building strong foundations for your future as the economy recovers.
Effective Planning That Mitigates Known Risks
As a business owner, your focus will be on strategically managing your enterprise to promote long-term growth and profitability. The Covid recovery brings a different set of challenges, ones that you may not have experienced before. With the economy on a knife-edge, every business decision could need careful calculation.
An experienced accountant can offer a different view of your business’ needs during a recession. Assessing risks is, perhaps, more important than ever – as are the actions to mitigate them. By conducting a detailed analysis of your business’ financial position, you’ll be well-placed to build on your strengths and plan for the worst-case scenario.
Managing Your Business’ Costs
Cost-cutting may seem the obvious route to financial survival during a downturn, but an accountant may be able to identify alternative strategies that could have long-term benefits for your business. Streamlining essential business processes or cutting back on unnecessary expenditure, for example, not only improves productivity and reduces wasteful resources, but also offers ongoing improvements that are likely to benefit your business for many years to come.
Need accountancy advice during the Covid recovery? Contact David Howard today. At David Howard, our specialists are experts in supporting small businesses during times of economic uncertainty. We understand how important your business is to you and believe that our pragmatic yet creative approach to managing your accounts can help to protect and preserve your enterprise during the recovery. To find out how our services could support your business, feel free to get in touch today.
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