Brexit brought a significant impact on businesses in the United Kingdom. Many small and medium-sized businesses suffered because of the increase in tax costs. Many also lost funding opportunities from the European Investment Fund (EIF).
Studies show that the political and economic crisis really affect the growth of businesses. They are among the biggest factors that cause financial issues among entrepreneurs. But aside from these, one more reason a lot of businesses fail is when owners don’t have enough knowledge about managing cash flow.
A poll with 1,800 owners of small and medium-sized enterprises in the country reveals that cash flow problems create the most significant effect on business growth. In fact, 54% of business owners say that cash flow management issues make it challenging to achieve success.
With this in mind, you need to find practical solutions. For one, you can get professional accounting services for small business in the UK. The following are other powerful techniques that can assist you with financial struggles in your business.
Explore funding opportunities
Consider reaching out to banks and other money-lending institutions that can help you raise funds to grow your business. You can also tap small business grant opportunities funded by the government. These funds will allow you to purchase more assets or resources for improving your operations. You can also use additional cash to support your new business strategies.
Monitor revenue versus expense
Always keep track of your costs. This will give you an idea about the ratio of your revenue compared to your expenses. With this, you can pinpoint unnecessary expenses that negatively affect your company’s profitability. You need to ensure that you earn more revenue compared to the amount of money you spend on capital and other business operations.
Keep a detailed record of finances
Having a great financial record-keeping strategy can help you build a systematic and organised way of keeping track of your finances. It will also allow you to reevaluate your budget, especially when it comes to paying for unexpected costs. By keeping detailed business records, you get to check out existing financial issues, which, in turn, allows you to resolve them sooner than later.
Records to take note include the income statement, cash flow, balance sheet, and payroll reports. You can hire assistants such as accountants and bookkeepers for these tasks.
Plan for growth investment
Invest in tools and resources for your business growth, as well. For instance, provide training to your employees to widen their knowledge about new business strategies. Also, look for potential business partners and come up with a brilliant method to build a bigger enterprise in the future.
Building a solid financial strategy involves short-term and long-term goals for your business. Make sure that you stick to a strict financial management process to avoid any money struggles. You might face greater challenges for your venture, but you can effectively combat issues by getting enough knowledge and making necessary preparations. Don’t hesitate to reach out to financial experts and other credible people who can assist you in managing your business finances.