5 financial tips for small businesses

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This is a delicate time and many people are being harmed. We know that the Coronavirus crisis is affecting the economy around the world, especially micro and small businesses.

That’s why we’ve selected 5 financial tips for small businesses that need to lessen the impact of the Coronavirus pandemic. Check them out below:

1 – Review your cash flow
It is essential that the entrepreneur knows his business well to understand the relationship between expenses and fixed and variable expenses. It is necessary to focus on cash flow.

When predicting a drop in revenue, it is necessary to prioritize what is essential. Expenses such as payroll, rent and maintenance are priorities. Expenses on input items (inventory), which vary according to sales, must be controlled.

2 – Renegotiate before debts arise
With the drop in revenue, it is necessary to negotiate norway whatsapp lead deadlines with suppliers and creditors in advance. Negotiation can provide the breathing space needed to keep up with those expenses and costs that cannot be postponed. This way, both parties will have more security when negotiating.

3 – Outline scenarios and make a plan
Self-employed professionals and small business owners need to analyze the current situation in the country and their business internally to understand how the Coronavirus crisis will impact them. Based on estimates of how long the crisis may last, entrepreneurs can draw up scenarios to understand the financial and operational implications in the short, medium and long term.

4 – Don’t fail to see opportunities
Don't limit your vision, don't focus only on the problems. Each professional has a business model and it is important to understand that, in times of crisis, great opportunities can arise. This is the case with delivery, e-commerce and the use of digital media, which have seen a huge increase in demand during this period.

5 – Be careful with loans
With increased competition in the financial sector, small businesses have greater access to lines of credit for purposes such as working capital. However, before considering taking out a loan, assess your needs and consider whether you will be able to pay the installments.

Finally, we want to highlight fundamental factors that you need to keep in mind at all times during your entrepreneurial journey, whether in crisis or success:

-> You are the soul of your business

Focus on what is really relevant at the moment and don't let anxiety prevail.

-> Take care of your mental health

Try not to focus only on bad news and stay informed from reliable sources.

-> Before, during and after the crisis: test and adapt

The ability to test, fail, adapt and test again for small businesses is much easier and faster than for large companies. Take advantage!

The only certainty in entrepreneurship is the need to adapt.

After the financial tips, if you are unable to analyze and proceed with all of this on your own, do not hesitate to ask for help.