When you have the finances you need in business, you can achieve so much more. If you are stretching your finances to the limit, then you will find that something has to give at some point. This could mean stretched finances have an effect on your customers, or even on the future of your business. Getting to grips with your business finances and raising finances in a sustainable way is what you need to be focusing on to ensure your business can stand up against the competition.
- Having An Action Strategy
To begin with, you have to start formulating an action strategy. Look at what you need business finance for, and look at how long you will need it for. For instance, will you need finance to cover you and your business through those leaner months, or are you looking at finance to help you grow and scale-up? When you know what your financial needs and requirements are, you can then start to formulate an action strategy. When you have a strategy to work to, you can be sure that all business finances are affordable and manageable.
- Borrowing Options and Availability
After establishing how much you need to borrow and for what, it is time to look at the options available to you. Not all options will work for you and your business, and this is why it is crucial to establish options and availability as soon as possible. So, are you looking at raising finances by taking out a loan with your business bank, or are you looking at raising finances by releasing cash through an asset you already own? When you look at business banking loans, you can find that they are high, and this could be that you have no collateral down. However, when you look at releasing cash via Car Cash Point and Logbook Loans you may well find that borrowing is a whole lot more affordable, simply because you have collateral in place. Establishing what financing and borrowing options work for you, and for your business will help you select the right option.
- How Much Finance You Need
In your action strategy, you have loosely covered how much you need (even in a worst-case scenario). However, now it is time to be more precise with the details. Accounting for where finances are required and needed down to the last penny and cent is crucial. If you are too generous within your action strategy, and within your general business finances, you will find that your business is not in as strong a position as you thought it was. An overview of your business finances and needs is OK, but it is not sustainable. Moving forwards, you need to get to grips with every aspect of finance within your business. This includes, how much you will need to stay afloat, and function on a daily basis, as well as how much you will need to scale up, and grow your business (either in the next few months or a few years).