These are tough times for businesses of all sizes, and many have taken some serious hits over the last year or so. Not all have survived, but those that have are gradually crawling from the wreckage and assessing the damage, while wondering how best to continue in a changing world. To rebuild your business after a financial downturn, it’s necessary to take a clear-eyed look at what went wrong and where your company stands right now. It’s also important to look to the future and find your place in it.
The basis of any venture is a business plan. This will have been the founding document when your company was established that set out your initial goals and the steps to be taken to achieve them. A business plan is not set in stone, however, and needs to be periodically reworked and reassessed if a company is going to survive and prosper in changing times. If you’ve recently taken a big financial hit, then looking again at your business plan is the first step to recovery.
A hard look
First of all, take a long, hard look at your finances. Update your accounts, your profit and loss statements, and your cash flow. How does it compare to the previous year? This will give you an accurate picture of your losses over the most recent trading period.
These figures don’t necessarily tell the whole story, however. Take into account whether you’ve had to make redundancies or cut costs in other ways. Have you downsized your office budget, reduced your marketing budget, closed some outlets, or had to freeze or cut wages? Have you lost clients or customers?
Manage your liabilities
A major outgoing for many companies is their tax bill, and many are actually paying more tax than is legally required. It’s worth engaging a firm such as Capital Preservation Services that specializes in advanced tax planning for businesses, active professionals and high net-worth clients. The firm’s corporate restructuring plans can reduce tax rates by up to 20%, and by minimizing liabilities and penalties on earnings and assets, the money saved can be channeled into marketing and consolidation of profits.
Time for a change
Now that you know where you stand, it’s time to reassess your business plan. Circumstances have changed, and you can’t afford to stand still. You may need to make a radical overhaul in order to adapt, or just a few tweaks. Whatever the case, you should focus on effective transformation at a root and branch level, rather than superficial or cosmetic adjustments.
Look at your industry as a whole and analyze what your competitors are doing. Make a note of new or emerging trends, and look for new opportunities, new gaps in the market that you might be able to fill. You may need to move more of your business online, which might require investment in new technology, new staff or retraining.
Who are you?
Go back to your core values as a company. What makes your business unique? What are your strengths and weaknesses? Look at your history and see what you do really well, and what hasn’t been working as well as in the past. Examine why this should be the case and how you can improve operational efficiency while still playing to your strengths.
It may be the case that you need to completely overhaul what you do and radically rebrand for a changing business landscape. On the other hand, you may rediscover essential qualities to your business that have been overlooked but now need to be brought to the fore.
You may find that your business requires additional funding to get to the next level. Look at government schemes and loans, or options in the private sector, such as from banks. Are you able to open new lines of credit, or extend existing ones?
It’s likely that you may have to reinvest in your business and spend more before your profits start to look healthy again. You may need to buy new equipment, take on new employees, or launch a new marketing campaign. Whatever you do, make sure that you have a clear idea of why you are investing the money and do a thorough costing analysis. Afterwards, look at the return on investment (ROI) to see whether the spending was worth it.
Fit and healthy
Don’t be afraid to make cuts if necessary. The aim should be a lean, streamlined and more efficient business. Map out a realistic schedule for your recovery. It won’t happen overnight, but one step should follow logically from another. Track your progress, and learn from your experiences to develop a crisis contingency plan for the future.
Ultimately, you should be left with a fluid, adaptable business model and a company that is cost-effective and resilient. Look to the future while building on your history and your core values. Always remember that you’ve survived the worst, and that by working to your strengths and remaining adaptable, you can come back better than ever.