- Building up cash reserve
Average 6-12 months of operating expenses. Make careful consideration and make sure the money ends up in the best place (make money work for your business).
- Protect cash flow
Make sure your invoices are always at the top of your debtors' pile. Become indispensable and communicate often and clearly with debtors.
- Be creditworthy
Always pay on time, as soon as you can. This will give you a good rating and strengthen your negotiating position with suppliers.
- Evaluate operating costs
Reduce expenses smartly: negotiate rent, find cheaper office supplies and evaluate purchased services.
- Manage stock carefully
Make sure you have the right stock and establish a plan with suppliers to ensure more stock rotation. Avoid stagnation and thus show suppliers that you are committed and well prepared.
- Arrange funding before you need it
Establish good relationships with lenders; it is essential that the bank knows your business well and believes in your strategy. These relationships also give your company flexibility to exploit advantageous opportunities and weather economic turbulence.
- Never stop marketing
Skimping on marketing budget is never a good idea to cut costs. After all, how will new customers get to know your business? Profile yourself as a true leader and give new customers confidence to come and do business. Continue advertising especially in bad times, the return on your cash flow will be great.
- Find reliable partners
Take the steps above and find out which companies want to work with you and which only want to take money and services. Find out who will weather the recession with you and who will drown!
