If your business finances are looking bleak, it’s up to you to sort them as fast as you can. Don’t be one of these business owners that thinks if you just leave the problem it is magically going to fix itself. This is absolutely not going to happen, and it’s more than likely to get worse, putting you in a worse position that you were in originally.
If you are not careful, it might even mean the collapse of your business which is something that you want to avoid at all costs. In this article, we’re going to be taking a look at some of the things that you can do to sort your business finances when they are looking bleak. Keep reading down below if you would like to find out more.
Find A New Investor
Speak to your current investor first and see if they are willing to provide the extra funding. If not, then trade shows and connections are your only option. Find an investor who is willing to give you the money that you need without taking too much of a share of your business. A good way to compromise is with a convertible note. This says that they will provide you with funding in exchange for some shares in the business when the note matures. Since you mutually agree on the maturity terms, you can make sure this favors your business growth. Of course, you’re going to have to give something up, but depending on how much the original investor owns, you don’t want to go too far with this
Speak to your current investor first and see if they are willing to provide the extra funding. If not, then trade shows and connections are your only option. Find an investor that is willing to give you the money that you need without taking too much of a share of your business. Of course, you’re going to have to give something up, but depending on how much the original investor owns, you don’t want to go too far with this.
Alternatives For More Money
Instead of looking for an investor, there are alternatives for more money. Some of them are more likely to work than others, so ensure that you are looking into all of the options and which ones are better for your business as an individual. It doesn’t matter what everyone else is doing, it only matters what you are going to do for your business.
As such, if you think that your business will be popular enough to get crowdfunding, then this is a fantastic option. You owe nobody any money as it is a gift from people who want to see you succeed, and you might end up with the money, or at least part of it. Do be warned that crowdfunding is tricky and doesn’t always yield the kind of results that you are looking for.
You can also work with banks that offer bank guarantees and make sure that you get bank guarantee information before you commit to this, provide you with loans, and so many other things. The important part of this process is that you are looking at all of your options and weighing up the pros and cons of each.
Cut Costs Where You Can
You own a business, so the thing that you should automatically look at is where you can start cutting costs. Now, there are a range of ways to save money in business, a lot of business owners just don’t want to do them. For example, have you thought about limiting the number of employees that you have and outsourcing whatever else you need?
For example, you can get rid of the large majority of your IT department and then hire a professional business to complete the tasks that need doing. This is far cheaper as you are only paying for the services that you use from this company, rather than paying a full-time employee. We know that letting people go isn’t something you want to do, but you have got to save your business any way that you can.
You should also think about going remote. If you go remote, you don’t have to worry about spending money on the rent of the office, the bills and anything else that comes with it. Everyone works from their own home and unless there are special pieces of equipment that you are going to need to give your employees, you’re pretty much off the hook.
Cutting costs can be a hard conversation to have with yourself, but it’s got to be done at some point. Take a look at the budget for each department and then decide if there are any that are constantly going over budget and why. It might mean you have to reevaluate the budget, but that’s an issue for your accountant.
Downsize The Business
The final thing that we are going to recommend is that you think about downsizing the business for the time being. This doesn’t have to be forever if you don’t want it to, but you do need to make sure that you can afford to provide high-quality to the people that you are still providing for.
Sometimes, the only way to do this is to limit the amount of clients and customers that you are actually serving, and make sure that they are getting the very best of your business. When you can manage this and you are getting steady levels of profit, then you can expand again and work on building your company back up.
It’s true that this might take a long time, but it’s far better than watching your business go under because you weren’t willing to do what it took to get on stable footing financially. Just keep telling yourself it’s not forever and it should be easier to get through.
We hope that you have found this article helpful, and now see some of the things that you can do if your business finances are looking bleak.
It’s true to say that there are many different ways of sorting out your business finances when they are looking bleak, and it’s up to you to figure out which one is going to work best for you. We wish you the very best of luck, and hope that you manage to get your business back on the right track sooner rather than later.
