As the saying goes, “Hope for the best, plan for the worst”. During trying times, it’s important to have a plan that ensures business continuity. Below are important items to consider.
Financial and Business Review
Review cash, loans, and capital structure to evaluate the financial health of your company. Review accounts payable and accounts receivable balances and aging to understand your short-term cash needs.
Review your current insurance coverage. An important question to ask is “Do you have coverage for business interruptions?”.
Create worst-case scenarios in your short-term forecast – Plan A, Plan B, etc. Know what key triggers will alert you to change course. Having pre-planned triggers will eliminate emotional decision making.
Plan Cash Flow Options
Here are some actionable ways to plan and improve your cash flow.
Look for government relief measures that your business qualifies for. Research how to go about applying for such benefits.
Discuss rental terms with landlords. If rent can be deferred or renegotiated, create a modified schedule of future payments.
Review accounts payable. Identify vendors that may allow extended payment terms to slow the outflow of cash.
Review accounts receivable. Offer incentives, such as discounts, to speed up collections. Create and send invoices as soon as possible after a sale is made or service delivered.
Review payroll costs. Consider the reduction of owner salaries and/or employee hours.
Prioritize your work. Are there projects that can wait? What are the important projects now?
Plan for Remote Work
In times of rapid change, remote work may become essential. When transitioning to remote work, it’s important to assess which tasks can be done remotely. Remote work is not effective for every position, while others can be moved right away.
For remote workers, hold mail or set up a schedule of 1-2 days per week for pickup and delivery of mail.
Check with clients and vendors to see if Bill Pay or ACH payments are possible.
Most importantly, schedule frequent check-ins with your remote team. Keep in contact. Keep the conversation going. This will help employees feel engaged and secure.
Set-Up Technology for Remote Work
Setting up a few key tools will ensure your remote work environment will be effective.
If your accounting software is housed on a local computer, it cannot be accessed remotely. It must be moved to an internal or third-party hosted server.
We offer a hosting solution for QuickBooks Desktop that stores your data securely in an off-site, certified SAS70 data center
Another option is to migrate from your QuickBooks Desktop system to the QuickBooks Online (cloud-based) version.
Receiving paper checks from customers when office hours are reduced or eliminated means checks sitting in the mail. Set up a service like PayPal or BillPay to collect ACH or credit card payments from customers. Those applications can be used to pay vendors as well.
Use a service such as HighFive, Zoom, or GoToMeeting to facilitate meetings with customers and team members. Video helps keep relationships strong.
Install mobile scanning apps to scan documents using your phone’s camera and easily email.
Set up a secured email portal to transmit sensitive documents. SafeSend allows you to send and receive emails with sensitive content.
Disaster planning is something we often put off. But, it’s important to have your business ready when the unexpected occurs. At All In One Accounting, we are committed to helping small businesses and non-profit organizations navigate these waters. We are here to advise and assist in the creation of your disaster plan.
If you’d like to download a full copy of our Disaster Preparedness Business Checklist please click HERE.