The Tough Times Business Checklist

With business conditions deteriorating for a lot of firms, now could be the time to review the way you run your business.

With the help of consultancy group 2020 we have put together a "tough-times business checklist" that will allow you to ensure that you stay on the right track during the turbulent times ahead:

• Review your Budgets and set realistic and achievable targets for the year.
• Get rid of can’t pay/won’t pay customers.
• Review debtors list and chase up overdue invoices.
• Make sure your terms of business contain explicit payment terms. Offer extended payment terms if required.
• Assign responsibility to one individual for invoicing and collections. Agree extended payment terms with all suppliers in advance (if appropriate).
• If appropriate, review banking facilities and discuss future needs.
• Put extra effort into making sure your relationships with your better customers are solid.
• Review and flow chart the main processes in your business (e.g. Sales processing, order fulfilment, shipping, etc) and challenge the need for each step. Encourage team members to suggest ways to streamline and simplify processes (e.g. sit down and brainstorm about efficiencies and cost reduction).
• Use “bottom up” budgeting where everyone in the office gives input on areas over which they have control – target a 10% cost saving.
• Review your staffing needs over the next 12 months and introduce more rigorous disciplinary procedures for any weak members of staff.
• Get your members of staff involved in a discussion of likely trading conditions and get their input on reducing costs and maintaining revenues.
• Review your list of products and services and eliminate those that are unprofitable or not core products/services.
• Establish your key performance indicators (KPI’s) and measure them on a daily basis. Typically, those are:
  • Sales Leads generated
  • Orders supplied/fulfilled
  • Cash balance
  • Stock Turnover
  • Debtor Days
  • Gross Profit
  • Net Profit
• Review efficiency of business processes and consider alternatives such as outsourcing certain activities locally or overseas.
• Pull everyone together and explain the business strategy and get their buy-in.