There are steps small businesses can take to handle the impact of the COVID-19 pandemic on revenue.
So says Ruth Urban, president and CEO of On the Money, an accounting advisory and bookkeeping firm at 7600 N. 15th St., who offered tips on ways to strengthen a balance sheet even if a recession occurs.
Urban recommends business owners focus on their cash flow because it is just as important, if not more so than evaluating income statements and balance sheets. She urges companies to proactively review where to increase or decrease cash. Urban said small businesses should cancel any unnecessary expenses in their personal and business lives and renegotiate terms with one-time/recurring overhead costs, as well as purchases from suppliers. She said it is smart to look for new payment choices, including lower credit card fees, that can lead to major savings.
Another way to recover from losses is to evaluate existing client bases for profitability, Urban said. Often 80 percent of profit usually comes from the top 20 percent of clients so now is the time to refer low or no-profit clients to services more suitable for them, she added.
Urban recommends small businesses start or keep separate accounts to hold funds when they need them or for the next rainy day. That includes money to cover three to six months of expenses. A tax fund is another option for the next account for your business.
To learn more, visit onthemoneyaz.com.