The post-pandemic landscape is surely going to be different than the pre-COVID days and businesses have to realign their planning and strategy for the future accordingly. As the pandemic has interrupted operations, productions, and sales as well, it is essential for companies to arrive at a realistic overview of the present situation in the face of the pandemic.
There is a need for a realistic and well-formed map for the road ahead while taking into consideration the outlook of the various stakeholders of the company. Let’s see some tips in order to uplift the financial health of your company.
Depending on your business model and industry, it’s frequently easier to cut variable costs than fixed costs, so tackle those first. Can you find an alternate, less expensive way to ship your products? Can you temporarily cut your sales personnel’s commission and incentivize them in a different way? But also think through how you can actually change fixed costs into variable ones.
Usually, every business has key expenses such as employee salary, rent for the office space, insurance and utility expense. Think about ways that you can reduce your expenses. For example, try to freeze hiring employees for the coming months and negotiate with your landlord for easy payment plans. Government and financial institutions are giving financial aids to the affected entities. So be update on the reliefs they are providing and get maximum benefits from them.
During this situation it is important to stay close to your customers and suppliers. You can consider having a deposit or advance payment for the future sales. Review your existing receivable list and try to recover cash at earliest possible specially the higher values. Find chances to negotiate payment terms with your suppliers.