BUSINESS TIPS - Managing Your Business in Tough Times - Part 1

BUSINESS TIPS – Managing Your Business In Tough Times

Part 1


By Nikki Viljoen – Viljoen Consulting CC – March 2011

Most will agree that the light at the end of the tunnel is not an oncoming train, and whilst the recession (such as it was) is now officially over, it will take some time to rally ourselves, make a comeback and hopefully deposit us right back to where we were – obviously not in terms of what caused the melt down in the first placee, but certainly in terms of running a productive and sustainable business.

I know I had to really ‘grit’ my teeth and bear it for a few months – you know what I mean –the uncertainly of money coming in, or getting the work in or making the sale and so on.

Fact of the matter is – that when you are in the dwang – that’s exactly where you are and no amount of anything will change the situation at that particular moment in time.

There are a number of tips though that will help you and guide you through, should you find yourself in difficult and/or uncertain times.

Finance:
For me, if you have lost control of your finances, then you have lost control of your business. I think that most people, when they think of business finances, they think it’s all in the books and whilst I agree with that on some level, I also want to make it very clear that the books are ‘reactive.’ By that I mean that they are ‘in the past’! What is contained in your books has already happened. Cash flow on the other hand governs what is happening right here and right now.

Think about it for a moment – it doesn’t matter how many people owe you money or who have promised to pay you – the bottom line is that when you look at your bank account it is about what is actually there (less what needs to be paid out) that actually counts.

So it stands to reason that the cash flow needs to be properly managed and should be discussed at every meeting. If, like me, you are on your own, it’s a good idea to make time (at least weekly) to check up and see what is going on.

Make sure that the management accounts are properly maintained on a regular basis that they are all consistently checked for issues such as outstanding payments from debtors and expenses. Controlling your finances means that your business is managed. Lose sight of them and you should probably close your doors sooner than later. It will be far less stressful and far cheaper in the long run.

Next time we will look at other tips around the management of your business in tough times.

Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za