How to protect your business from financial difficulties

Mr Bankruptcy

28th February 2022

Over the past two years many businesses have had to review what they do, how they operate and what changes they need to make to ensure their longer-term survival during unprecedented times.

It has revealed how resilient businesses can be, but also how precarious they can be; so how can businesses protect themselves from financial difficulties in the future?

6 steps to better financial management

A few key steps can make all the difference to protect your business from financial difficulty. These steps are about managing costs, managing information, and using that information to make the adjustments needed to keep on top of the financial situation:

• Have a plan: You need to know where you are, where you want to go and how you’re going to get there to identify how resources are allocated to avoid waste. It ensures you know if you’re not heading in the right direction so you can correct your course.
• Manage costs: Knowing your day-to-day costs is important, so you know how much it cost to operate effectively. When times are challenging, cutting costs can help protect you, but sometimes difficult decisions have to be made when managing costs and where to make cuts.
• Manage your debtors: A good credit control process is essential to manage cashflow and this is vital to secure the long-term financial security of your business. Clear terms and a strong process can help ensure invoices are paid on time.
• Track financial data: Keeping accurate records and reviewing them regularly makes you aware of your financial situation, can spot warning signs and areas of difficulty and adjust before it’s too late.
• Review client and supplier contracts: Make sure these are the best terms for your business and you’re not committed to anything that can’t be delivered.  
• Talk to creditors: If paying creditors is proving too difficult, talk to them early on to see if alternative arrangements can be made, rather than them taking action that may put your business at risk.

Avoiding the personal cost

Perhaps just as important as protecting your business from financial difficulties is being able to spot the signs that you may be in difficulty. Struggling to pay creditors, reduced revenue, losing clients, poor cashflow and at a personal level, higher anxiety and inability to sleep because of business are all signs that you need support.

Seeking advice early on will help you take back control of your business’s financial situation and rebuild for the future as well as reducing stress on yourself, your family and friends.

James Rosa Associates

James Rosa associates is a firm of debt advisors and debt adjustors. With a supportive and friendly approach, we offer a full range of advice and professional services to individuals and business owners/directors who face unmanageable debt or who are involved in civil or commercial disputes. Our services include:

• Insolvency support
• Negotiated settlements
• Personal assisted bankruptcy
• Mediation

We are authorised and regulated by the Financial Conduct Authority (FRN665061) to work with clients to produce bespoke solutions to fit their specific circumstances.

Find out if you qualify for a free consultation

If you want to deal with an unmanageable debt, or bring a dispute to a swift and cost-effective resolution, contact James Rosa Associates, ring 0845 6807217 or email enquiries@jamesrosa.co.uk to find out whether you qualify for a free consultation.

Please be advised that all views expressed in these posts are those of the author and not of James Rosa Associates ltd.