Failing to prepare is preparing to fail. This sporting metaphor certainly rings true when thinking about your business’ finances too.
Whether you work by yourself or employ a number of staff, chances are you will always have headaches about money when thinking about the future. It’s a common problem and, unless it starts growing on trees, one you will have to continue to deal with. The best way to counteract these challenges however is by having your finances as organised as possible, making sure you know where your money is going and what you can invest in for the future.
Read on to find out some of the areas where financial foresight can really help the balance sheets of your business.
Energy prices
Oil and gas prices seem to be perennially rising, with burgeoning wholesale costs being passed on to customers.
And whether you run a small office or a trade shop, chances are you will use a lot of energy. However, you can escape this unpredictable situation of being at the whim of energy companies and their price hikes by capping your costs for a set period of time. The major energy suppliers all offer business tariffs where companies can agree a fixed price for each unit of energy they use, helping you calculate your bills rather than waiting in dread for it to pop through your letterbox for a number of years. Although set higher than current energy prices, the fact that so many businesses are currently on uneconomic plans means you could end up saving money whether tariffs rise or not.
Factoring
Cash flow is the lifeblood of a business-so don’t let yours suffer waiting for customers to pay their bills.
Factoring is appealing in industries where cash flow is scarce, such as trucking, which is why freight factoring is commonplace for truckers.
Factoring is a service many major banks offer where they advance the majority of your invoice and then deal directly with your customer over payment of the debt. Whilst your business will be charged for this service, ultimately it will guarantee money reaches you in a timely fashion and help you plan and invest for the future.
Green technology
Reducing the costs of your business in the long term, whilst maintaining the same level of service, is the financial dream of every owner. And one way of achieving this is by investing in energy efficient equipment. Offering lower running costs over their lifetime and less maintenance problems, buying the right green technology for your business could help lower your enslavement to energy bills and help you take greater control of your finances.
Mikael Johansen is a freelance writer working with a range of brands including npower.
How organised are your finances? Please share some top tips that you have implemented in your business.
