Every business transitions through phases of insufficiency and surplus. Keeping consistent and accurate records help in gauging the status of your business. However, once you realise your business is not following your laid out plan, craft a restoration plan as soon as possible. Here are four tips to help you reclaim the situation.
1. Review the strategy
Firstly, work out what went wrong. Is it a pricing issue? A sales generation issue? Or perhaps overheads are higher than you expected or you can’t source the skills that your business needs. Create time to explore the situation and identify actions that you can take to bring things back on track.
There are times when you need to make a large change to your strategy, and there are times where simply recognising what is lacking can set you back on course. Whilst you’re here, and identified the ‘success factors’ to your business strategy – consider how you can monitor these into the future so that you can quickly see how you’re going and correct course if need be as quickly as possible.
2. Consult the right people
Consider seeking professional help with the success factors you’ve identified above. If marketing is what you need, find someone who can put a strategy together for you and either implement it or train you or your team. If you’re finding it difficult to identify the cause of your detour from step one – consider reaching out to your accountant to help you better understand the numbers and what they mean.
Whilst we’re mentioning your team – don’t forget to consult with them. Many business owners forget that their team is at the coalface of their business, they often see things the owner doesn’t and they can also bring some great ideas to the table.
3. Communicate with external parties
Effective communication is the key to every successful organisation. If you’re struggling with cash flow, don’t duck and hide from your accounts payable. Work out a plan that you can stick to and communicate with your creditors that you’re experiencing some cash flow restrictions but have a proposal on how you plan to manage it.
Whilst you’re there, don’t be afraid to ask for more favourable terms if you’ve got a good relationship with suppliers.
Don’t forget about the ATO and Super – As a priority you should do everything you can to ensure you pay your superannuation on time, as late payments mean no deduction. Treat the ATO like any other creditor, if you need a payment plan ask for one, just remember that all ATO payment plans require you to lodge and pay all new amounts on time so make sure you consider this when working out what you can afford to pay.
4. Review your overheads.
Take another look at your outgoings to see if there is any discretionary expenditure that you can reduce going forward. If items are critical to your business then think twice about reducing them as you don’t want to negatively impact your customer’s experience with your product or service. Whilst you’re here take at look at staff contributions to your business, do you have a way of measuring productivity or return per employee? If you don’t, work out how you will know that a team member is performing, bring them into the conversation and start measuring, monitoring and managing performance.