2020 posed enormous challenges for businesses of all shapes and sizes. So, the financial picture of your business is likely to look very different in 2024.
In a report by consulting firm McKinsey, cost management is now the highest priority for almost 70% of businesses surveyed.
So, to help you avoid financial trouble and protect your bottom line, we’ve outlined 5 ways you can keep control of your money in 2024.
Set a proper budget
We all know that budgeting can lead to headaches and is not something many business owners love to do. But a simple spreadsheet that includes your monthly budget, forecast and actual income will help to highlight where the money is coming in and where you may be heading towards financial trouble.
Creating a business budget will help you to pay down any debts, manage your cashflow ahead of quieter months and will help you to get on top of any debts. And starting a budget isn’t hard to do. You just need to get a little organised.
Plus, there are plenty of budgeting tools available that’ll do most of the organising for you.
Spend less, save more
Everyone is saving more and spending less and that’s understandable. With the economy dipping, or even double-dipping, your focus should be on saving every penny you can.
But it’s the marginal gains that will put you on the front foot when it comes to saving. For example, many third-party providers are offering the chance to pause payments on contract subscriptions or take interest-free breaks.
Even with our own software subscriptions at Grafterr, we allow customers to pause and unpause payments whenever they like, and as many times as they need to. And in times like these, we all need to help each other out, right?
So, look out for these offers and take them up. And over time, you’ll notice the amount you’ll save.
Look for the right opportunities
Since we’ve all had to tighten our belts in the past year, there’s been a drop in personal spending. So things like daily commutes, morning coffees or after-work socialising are almost non-existent now.
And of course, this has hit the revenues for those business operators. But with reports also suggesting that 60% of Brits want to actively support local businesses, business isn’t going away but moving elsewhere. So, with these opportunities, be sure to capitalise on them by reaching out to your local customer base.
Target customers on social media who are already following businesses local to yours, or following similar offers. They’ll be more likely to come to you know that you can deliver to their door.
And with a recent surge in popularity for takeaways, we have some tips on how to generate more orders and make the most of the current demand.
Prioritise debt repayments
Did you need to take out a loan during 2020 lockdowns? If you did, you’re not alone – 1.5 million interest-free ‘bounce back loans’ were issued to UK businesses since May 2020.
And as an interest-free loan, it’s worth borrowing the (up to) £50,000 on offer. However, terms and conditions stipulate that interest will be applied 12 months after taking out the loan. So, to avoid having to pay anything on top, you need to make sure the loan is the first thing you pay back.
By making savings where you can and accumulating an emergency fund, you can pay your loan back quicker and avoid any financial trouble.
Redefine your financial goals
The more specific you can be about your goals in 2024—what you want your business to achieve financially—the more chance you’ll have of hitting your goals.
So, within your 2024 financial plan, set goals that are SMART.
In other words, make them Specific, Measurable, Achievable, Realistic and Time-bound. And by setting them out this way and writing them down, you’ll be more likely to hit them.
With so much changing all the time, it can feel difficult to set a financial plan for 2024. But by doing so, you will be better able to stay on top of your finances and feel more prepared.
