We continue to celebrate Black Business Month by spotlighting Black female business owners! Angela Randolph, CPA, MBA, is the founder and CEO of Stellar Ledgers LLC, a WBENC-Certified WBE. Fully embracing her ambitious and entrepreneurial spirit, Angela’s career spans over 20 years of progressive leadership roles in finance, accounting and tax across varied industries such as oil and gas, manufacturing, Big 4 public accounting, state and federal government. In this article, Angela Randolph gives WBEs a thorough outline to thrive financially through hard times and come out on top!
In times of uncertainty and difficult situations you may be wondering how to weather the storm. It’s possible to thrive not just survive during various business cycles. I’ll share some traits and strategies of resilient businesses that prove critical in building a successful and scalable business:
Purpose
Knowing your “Why” and the true purpose will help maintain your momentum. There will be days that your level of enthusiasm or energy will fluctuate but focus on why you started the business and what value and contribution you wanted to give to the world then you are sure to have longevity.
Plan
Setting S.M.A.R.T. goals and being intentional with your business can help you stay ahead of the curve. You want to create a plan of action in key areas of your business, so you are not caught off guard by the external environment, competition, or market fluctuations. The acronym stands for specific, measurable, achievable, relevant, and time-bound.
When planning your course of action in challenging environments it’s important to get a crystal-clear understanding of the financial position of your business– this means updating your financial records and keeping them in order. Knowing things such as your cash position and assets that can be sold quickly will go a long way in helping you make informed business decisions. Good records build a solid foundation for a successful business. They’re also important when applying for government grants.
According to a survey of the Federal Reserve Board of Governors, Senior Loan Officers, the demand for small business loans is gradually increasing while banks continue to slowly tighten supply. If you know now that you’ll need funding for expansion in the future then position your business for available financing instead of when you absolutely need it.
People
Small businesses have really struggled with finding new employees. According to the U.S. Census Bureau that tracks small business hiring needs shows the need for new workers have increased since August 2020. The demand for labor has increased to over 40% at the end of March 2022.
Be sure to define the critical roles needed in your organization. Develop job descriptions and standard operating procedures prior to hiring staff. Hiring mistakes can cost you money and setbacks in your business so this process should be done carefully when considering candidates. It’s very important to have the right people on board because it’s crucial in the success of the business.
Profits & Cash Flow
If you are in business and not making a profit, that’s a sure sign that adjustments are needed. You’ll want to examine the financial health of your business. The goal of every for-profit business should be to maximize the bottom line. Tracking key performance indicators (KPIs) for your finances enables you to identify areas that need improvement and keep you on target. By looking at key financial figures, you will get an idea of how your business is doing. You can see fundamental factors such as the liquidity and solvency of your business which will help you decide on the best steps forward as you deal with the crisis and the aftermath.
A lot of businesses across the world are facing cash flow problems now. You are certainly not alone. However, the key here is not to let the problem worsen. Preparing a cash flow forecast should give you some forewarning before issues arise and will allow you to address them early on. You can also take the following measures to boost your cash flow:
- Identifying the demand for your products or services, so you’ll know where to focus and where you can reduce product orders.
- Cutting back on unnecessary expenses.
- Urging your customers to pay you, negotiating on a payment term that will work for both of you.
- Seeking vendor payment extensions or debt restructuring.
- Invoicing as soon as you deliver the product or service.
- Seeking external investors or lenders.
- Taking advantage of financial support from your government.
Pivot
Flexibility is required in business, especially in today’s global economy. Don’t be afraid to change directions when necessary. Be ready to adapt and embrace unchartered territories. Ask for help when you need it. Seek guidance and advice from trusted business advisors and other experts.
Summary
It’s entirely possible to build a sustainable business and for established ones to thrive not just survive in turbulent times. The financial tips and business strategies shared here will help minimize risks to your business. If you need more guidance reach out for help on developing a plan to weather uncertain times while saving you time and money along the way.
