Five ways to protect your business during the cost-of-living crisis

During this time of rising costs and uncertainty, you might be worried about your business and how to protect yourself.

Here are five tips and tricks on how to best prepare your business for the rise in prices across the UK.

1.     Know your business inside and out

Your purpose and goals for your business might have changed since you started it and this is a great time to reconsider the ultimate purpose of your business and what you want to prioritise in this difficult period.

Having a clear idea of your end goals for the current year will make it easier to view your business with more clarity of what you want to achieve and how to make this happen moving forward.

2.     Prioritise management accounts

By having detailed and regular updates on your business statistics performance, you can see exactly what is working well in this changing environment and what you could consider adapting.

These monthly or quarterly updates will be an essential addition to your business as they provide you with a great overview of what to prioritise and will allow you to remember/reconsider your purposes and goals regularly.

3.     Changing behaviours to reduce unnecessary costs

Encouraging your employees to reduce their waste and turn off their electricals when not in use is a simple but great way to start. Many businesses are struggling with no cap on their energy bills, causing astronomical increases so every little change truly can make a difference.

Introducing small changes across your business, such as these, can save a substantial amount of money over time and reduce bills by a considerable margin which is a big goal for many now.

Simply creating new habits can go a long way to save money on those rising bills.

4.     Look out for your employees

Although now is probably not the time to be handing out endless pay rises, it is important to ensure your employees feel supported as the cost-of-living crisis is affecting everyone.

Remember that pay increases aren’t the only option for employees who need extra help – remote working or changing their hours to help with childcare expenses can also be beneficial and will show your employees that you understand.

It is also advisable to speak to your accountant about tax-efficient ways of increasing employee benefits as this will result in your business being in a good financial position while still giving your staff a morale booster when they need it most.

 In the long run, reaching out will result in a better outcome than ignoring the situation and potentially seeing employees leave their job for another role.

5.     Look at reducing your outgoings

It is always worth starting a conversation with your suppliers about a slight reduction in cost or with your clients about an increase in your services. It isn’t a guarantee but by opening a discussion, it’s a proactive option for protecting yourself. Despite the suppliers and clients being in the same situation, there is always a middle ground that could be negotiated around.

Another option to consider is looking out for new clients that could mitigate the extra costs you’re seeing, especially if keeping on older clients becomes unprofitable.

Despite the stressful and confusing time this might be for you, don’t panic - contact us for any advice.