Friday 7th November 2008 Blog

10 Ideas to Crunch the Credit Crunch

 If your clients business is feeling the pinch in this general economic downturn, it's more important than ever to look at what they can do to help their business. Here's 10 ideas to get them started...

1. Get paid sooner! Encourage their customers to pay them more quickly, by giving small discounts or just by chasing customers promptly. Get them to send out invoices for completed work as soon as possible, and for long term projects ask for stage payments on account.

2. Promote best value products. If your clients have a range of products or services, ensure they look at giving more prominence to the best value items in their marketing.

3. Talk to the bank. Make sure your clients keep the bank informed, particularly if they are going to have a need to secure extra funding or even renew existing arrangements. If fees are being increased it may pay to look elsewhere for facilities.

4. Take advantage of the crunch. If clients are cash positive, turn the crunch to their advantage. Some businesses may be keener to make a sale so those with cash may be able to negotiate some great bargains, particularly for early payment!

5. Staffing needs and working hours. Clients should consider asking staff to change their working hours to part-time or flexi-time, with an appropriate drop in total pay. Or to take their holidays now if business is slow. If a skilled member of staff is about to retire your client may want to consider asking them to stay on part time, as this may be cheaper than recruiting a new employee.

6. Office rent. Your client may want to ask their landlord if they can change the rent from quarterly in advance to monthly. Or with improvements in technology perhaps now is the time to consider if they could run their business from home to lose the office rent altogether!

7. Don't forget the marketing. Whilst cutting back on costs can be necessary in a recession and it may be tempting to cut the marketing budget, it may prove a false economy if sales suffer. Whilst others cut back on their marketing, your clients may be able to use this to their advantage and keep on marketing to get a larger share of the present market.

8. Renegotiate with suppliers. Review the agreements your clients have with suppliers for continuing services, such as energy or cleaning. Can they renegotiate any of these contracts to get a better deal?

9. Reduce tax payments on account. Review the projected tax payments for their business. Payments on account for unincorporated businesses can be reduced and reclaimed if they are confident of the taxable profit figure. This is a good reason for getting the accounts completed quickly after the year end.

10. Carry back losses. If your clients business is likely to make a loss for the current year, quantify that loss as soon as possible and submit a claim to carry back the loss to get a refund from HMRC.

Posted by: Bookcert Mentoring Team

Friday 7th November 2008

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