While it may be hard to quantify the precise state of the UK economy post-Brexit, the early portents do not look good.
Britain’s economy grew by just 0.4% during the final quarter of 2017, for example, while recording an annual expansion of 1.4%. This established the UK as the slowest growing major economy in the world, behind Japan and European neighbours Italy.
This is hardly good news for British firms, who must take a proactive approach to achieving growth in the near term. Successfully managing finances is an excellent place to start, so here are some key pointers to get you stared:
- Organise and Prioritise your Spending
While many may react to such news by capping spending and refusing to reinvest further in their ventures, this can prove counter-intuitive.
Although you may need to tailor your budget slightly in relation to adjusted revenue and profit forecasts, the most important thing is that your organise your finances and ensure that they are invested in a way that delivers an optimal ROI.
More specifically, you’ll need to prioritise your spending, distinguishing strategic and non-strategic costs and focusing primarily on investments that will help your business to achieve organic growth during austere times.
- Perform an Audit of your Business Finances
Some entrepreneurs may consider audit to be a dirty word, but this process can actually have an extremely positive impact on your businesses finances.
This is particularly true when you employ an external and objective body to undertake the audit, as the information gathered can offer a true insight into your finances and identify key areas for improvement. Service providers like RSM can fully appraise everything from your bottom line figures to your reporting processes, for example, highlight any inefficiencies that impact negatively on your short or long-term gains.
This type of proactive audit can also help you to remain tax compliant, negating the risk of future sanctions and penalties.
- Make People Accountable
Depending on the size of your business, you may delegate fiscal responsibility to one or more members of your staff.
This can help you to maintain focus on an underlying strategic vision for your business, but it can also create risks in terms of inconsistent reporting processes and individual human error.
While implementing regimented systems and processes can help mitigate these risks, it’s also important that you empower your employees and make them accountable for managing their own budgets.
This type of responsibility can inspire some, while it also ensures that there is a clear point of contact in instances where mistakes are made.