5 Tips to Stay Afloat When Times Get Tough

Businesses, along with individuals, tend to suffer when the economy is struggling. This is especially the case if they have not made provisions to protect themselves from such an event. 

Before this happens is the ideal time to take an audit of business operations. An audit will reveal where positive changes can be made. If an economic downturn has already occurred, these same tools can be applied to make the needed changes to face future challenges. 

Diversification of business investment options

Businesses can take advantage of the investment opportunities available in the market today. One such strategy to pursue to protect financial wellbeing in the tough times is to explore the benefits of high frequency trading. In today’s fast-paced world, having experts to take care of millisecond investment opportunities on your behalf is a strong advantage. 

Automated trading that takes place in seconds is definitely an option for businesses and individuals to investigate to safeguard their incomes and wealth creation against poor economic circumstances. Using investment opportunities that are built into this trading option is a positive way to stay liquid when times are less than ideal.

Regular business audits

Conducting an impromptu check and balance audit on an irregular basis should be a business policy to guard against unauthorized expenditures. Using an audit as a tactic to stay afloat in times of trouble, though, is a recommended tactic to determine business status. 

Check through your books to see whether all your payments are being made to actual suppliers. If you do this check, you may be surprised at what you learn if you leave this job in the hands of an employer. 

Either way, it is a good policy to apply in support of your new intention to safeguard your finances and keep cashflow moving in the right direction.

Reduce operating costs where viable

When times are not so good, it is time to reduce all those areas where there is overspending. This same principle applies to business operations. Do a thorough analysis of your business operations. See where costs can be reduced or eliminated, and then take the necessary action to make that happen. 

Even if this tactic will only benefit you in 2 months’ time due to notice periods, don’t delay. There is an element of energy in intent, so saving costs in one area will motivate you to do the same in others. This should snowball enough so that you end up saving a good sum, without compromising your operations. 

Manage your working capital to your benefit

A good way to get your cashflow back onto a fairly healthy track is to follow up on your accounts receivable. This is dead money lying in the hands of others, that you could be using to bolster your business during tough times. Make those tough phone calls and get your money paid to you, which is where it belongs. 

If you have excess inventory, make sure that you don’t order anymore of what you don’t need. If it is at all possible, return items if the creditor is willing to accept this action. Both actions will free up capital or improve your cashflow. 

Refinancing as a last resort

To aid your efforts in staying afloat during hard times, you can also explore the potential of refinancing your debt. This tactic involves consolidating your debt and repaying it over a longer-term. 

You will pay more interest in the long run, but it will help you stay afloat right now. Or, you can contact all your creditors to restructure your loan payments. Pay the debts over a longer period, with smaller payments for the interim period. 

Filed under: Life

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