Maintaining positive cash flows can be challenging with everyday business concerns. The coronavirus pandemic that took the world by surprise in early 2020 has had a major impact on thousands of small businesses, some of which may not recover. At Infinity Lending Solutions, we want to see our clients recover from the financial shock of the pandemic and get back to a point of having consistently positive cash flows. Below is an outline of steps we recommend all small business owners take to achieve this goal.
How Your Business Should Respond to a Potential Financial Disaster
The financial services industry takes information gleaned from previous large-scale events and uses it to help businesses navigate the current circumstances. Here are several lessons you can take from the SARS outbreak, Japan earthquake, and other disasters over the last decade or so.
- Ensure your supply chain network is strong and prepared enough to handle the challenge.
- Convert fixed costs to variable costs whenever possible.
- Keep business financing options open.
- Brainstorm new or non-traditional ways to bring in more revenue.
- Pay attention to conversion cycles focusing on cash to cash.
- Review your business interruption policy to see if you’re eligible for any type of payment.
- Rework variable costs to eliminate non-essential items and reduce costs wherever you can.
- Complete audits of your company’s accounts receivable and accounts payable.
- Consider new capital investment plans.
- Consider alternative lenders for supply chain financing.
- Request more time to pay an outstanding debt from some or all creditors.
- Be sure to maintain tight control of inventory management.
Making cash flows management an integral part of your company’s coronavirus pandemic risk assessment is an important aspect of your financial recovery. Review this list often to add new information or eliminate steps that no longer present a major issue with cash flows management.
Please contact Infinity Lending Solutions today for more in-depth advice to ensure your company comes back from this crisis stronger than ever.