Be Prepared for Economic Downturns With Business Financial Planning

Written by Amanda Bower    |    Published: July 6, 2022

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Laptops on a desk as startup founders work.

As we’ve seen in the past few short years, unprecedented times can present us with incredible business challenges. It’s safe to say that none of us were expecting the pandemic to hit the way that it did, and for it to completely transform everything from our personal lives to the way our businesses function.

Now, business owners are recovering, navigating this post-pandemic world, and are looking for ways to ensure their businesses are ready to thrive in the future, despite whatever new challenges they may face.

And the best tool for combatting unprecedented times going forward? 

High-quality and comprehensive business financial planning.

After all of the turmoil and uncertainty, we’ve seen that the best way to weather economic and organizational challenges is to have resilient strategies already in place. 

Yes, being prepared for the unknown challenges of the future means having rock-solid business financial planning today. 

By now, we know that we can’t just leave our business finances up to chance, or wait for the next big challenge to come and test if our organization is ready to handle it. Resilient financial strategies help ensure that our organizations are as thoroughly prepared as possible, for whatever comes our way.

That way, when the next crisis does hit, we can make the best-informed decisions possible. 

What does a resilient financial strategy look like?

What exactly is a resilient financial strategy, and how can it help you be soundly prepared for unprecedented times? 

A resilient strategy means having comprehensive business financial planning in place. A multi-faceted approach ensures your business is prepared for crises, fluctuations, massive changes, shifting consumer needs, and other unplanned challenges. 

Deploying a resilient strategy means that different areas of your business finances, like financial reporting, cash management, and payroll, are all being expertly managed, so that if a crisis were to occur, you can focus on making the best decisions for your organization. 

Typically, having a resilient financial strategy also means having an excellent financial partner in place, who helps you handle these different aspects of your finances. They also help you make educated financial decisions, and navigate these fluctuations in the business, as well as global events.

Ultimately, business financial planning means that we won’t wait until a crisis to see if our organization’s financials are prepared to withstand turmoil. 

So, how can we best prepare our organizations to skillfully navigate challenges? How can we provide them with the comprehensive business financial planning they need to weather these storms?

Let’s dive in.

How prepared are you?

The first step to understanding how to best prepare our organizations with business financial planning is to understand where we stand today. 

Exactly how prepared is your business to navigate an unplanned crisis that impacts finances?

Here are some critical questions you can ask yourself to find out.

  • Are we using the best bookkeeping strategies?

Bookkeeping for startups isn’t always a priority, but when a crisis hits, you want to make sure that your books don’t only look good for regulatory purposes. Accurate and consistent books help you understand your data, manage your cash flows, and will lead you to make better overall decisions on how to spend money. 

When there’s a challenging situation, your books should be something you can turn to, which are incredibly accurate and helpful in the decision-making process. Trust us: you don’t want to discover some massive errors when you’re trying to make financial decisions with huge implications during trying times.

  • Are we using the best financial forecasting models?

In the wake of the pandemic, business leaders are taking hard lessons learned from those difficult times, and are using better financial forecasting models to best prepare for the future. Deploying the latest financial forecasting tips will help your business make the best decisions in the present, ultimately making sure you’re as prepared as possible for the next major challenge.

For example, if you’re using accurate and advanced financial forecasting methods, you’ll be able to plan for growth during certain months, and can plan when to prepare new product launches or marketing campaigns. By using the right financial forecasting model for your business, you’ll already be making the best decisions for your organization today, and you’ll be best prepared for whatever comes next.

  • Is our accounting crisis-proof?

Tax services. Financial reporting. Cash flow analysis. Is your accounting in order, and being handled by professionals? Crisis-proof accounting is incredibly important all of the time, but becomes particularly critical during unprecedented times.

Imagine this: the next massive crisis hits, and shortly after, you find out last year’s tax returns were filed incorrectly. Now owe the IRS way more than you thought. 

The last thing you want during times of turmoil is to discover your basic accounting wasn’t handled in the best way possible. Small errors can have massive implications when it comes to business accounting. 

In order to ensure all of your accounting is crisis-proof, you should make sure you’re using small business accounting services which are well-suited for your needs and ensure that your business is ready to withstand any challenge. 

  • Is our CFO prepared for unprecedented times?

If you’ve experienced rapid growth recently or you plan to, you might be thinking of bringing in a CFO to help manage your growth, cash flow, and other big financial issues, such as deploying proper processes.

CFOs should be ready to handle all of the big financial decisions and questions, but they also should be ready in case of a crisis or unplanned event. Or, if you don’t yet have a CFO in place, you might want to consider adding one, who will be the financial expert ready in case something does happen.

If you’re considering adding a CFO, don’t forget that you also have the option for adding an outsourced CFO to your organization, who can help you with financial strategizing, financial forecasting, budgeting, and cost-cutting. 

  • Are we prepared to take advantage of assistance programs?

During times of crisis, business assistance programs can be a make-or-break for many businesses. Take the Paycheck Protection Program (PPP), for example. The PPP loan helped businesses keep their workforce on the books during the coronavirus pandemic, and kept many people on payroll who otherwise would have lost their jobs.

But in order to have received this loan, businesses had to have their finances in order, be aware of the program and its dates, and be in the position to actually apply for it. Unprepared businesses that missed the application deadline ultimately missed out on massive opportunities.

By already deploying the best business financial practices, your business will be well-poised to rapidly respond to any government assistance programs or applications, should a crisis arise. 

What do I need to do in order to keep my business or startup’s finances healthy?

As we’ve seen, in order to best be prepared for unprecedented times, our business financial planning needs to be in excellent condition, and we should be using the top tools and industry best-practices to help us get there.

In other words, to best plan for the future, we need to look at the now.

In order to keep your business’ finances healthy, thriving, and ready for anything, there are six major financial services you can incorporate into your business financial planning strategy.

Accounting & Bookkeeping

Accounting & bookkeeping is complex, wildly important, and unfortunately, often mishandled by businesses. For example, many skilled leaders and entrepreneurs miss financial opportunities and make small accounting mistakes that cost their company time and money. 

Instead of leaving room for error, why not leave the numbers to the professionals?

Businesses should absolutely include outsourced accounting & bookkeeping as part of their basic business financial planning strategy. And typically, these services go way beyond just basic bookkeeping.

For example, here at hiline, our services include:

  • Credit card reconciliation: Credit card statements may not be fun to keep track of, but we may sure everything is properly recorded.
  • Employee expense management: We streamline your salaries and wages for maximum efficiency.
  • Monthly financial reporting: Monthly financial reporting is crucial for all businesses, but especially for startups and small businesses, where incomes and costs can be difficult to predict. That’s why we produce monthly reports, so you stay on track.

Cash Management

Staying organized with the movement of cash is no small undertaking, which is why it’s best left up to the professionals. Cash management is the day-to-day management of the cash in your organization, both how it’s going out, and how it’s coming in. With cash management services as part of your financial strategy, your finances are always organized, and you understand exactly where your organization is today. Cash management can also help you understand your predicted future cash flow, based on your forecasts. 

Cash management is critical to business financial planning because if a crisis were to hit, you need to have an excellent handle on the state of your finances. When an unprecedented situation hits, you don’t want to be scrambling to analyze your weekly cash flow or sort through vendor payments. Everything should already be in excellent order so you can consolidate your efforts and focus your energy on weathering the storm. 

Proper cash management also puts in place proactive safeguards such as having credit card availability and a business line of credit in place so that funds can be readily available in times of need without having to apply for funding.

Financial Reporting & Analysis

Financial reporting and analysis is a bit like having a crystal ball: you can look into the future by taking a good look at your past. Financial predictions mean having a data-driven future, because this reporting and analysis allows key decision-makers to land on the best decisions possible for their organization.

Financial reporting and analysis is incredibly useful, and should certainly be part of a business financial planning strategy. Leaders can make informed decisions that steer the business away from unnecessary risk, and can best plan for the future. 

While these strategies are crucial all the time, they become even more  vital during times of crisis. When unprecedented challenges arise, leaders should already be positioned to make informed decisions by leaning on their reporting and analysis. 

Proper Tax Filing

Tax season shouldn’t be something that weighs you down. When you’re running a small business or a startup, you want to be focused on your business, goals, and dreams, not on filing with the IRL. That’s where proper tax filing services come into play.

Sure, there’s no legal requirement for a professional to handle your taxes. But all business owners know that feeling of taking a look at their tax documents and needs. It can be head-spinning, at best, and no business owner should seek to navigate these waters on their own.

From things like sales tax compliance to business expenses, professional services make proper tax filing a walk in the park. Here at hiline, our extensive tax filing services include;

  • Tax savings and credits: We look for ways to ensure you’re paying the least amount of taxes possible, period.
  • Sales tax filing: This particularly complicated area depends on state and government regulations, but it’s something we’re experts in. No matter where you’re selling your products, it’s vital to comply with all relevant tax laws.
  • Proactive tax strategies: It’s not just the most recent financial year that matters, but also the following year. Here at hiline, we look for ways to optimize your tax position for the future.

HR & Payroll

HR & payroll shouldn’t be bogging you down, and it shouldn’t be something that you’re wasting your time and effort on trying to get right. Whether or not you already have an HR & payroll system in place, we guarantee that these matters are best left to the professionals as part of your comprehensive business financial planning strategy. 

HR & payroll should be efficient and expertly handled, and you don’t want to end up dealing with the potential costs of noncompliance. These services are even better handled when they’re done by a financial expert who is working with you in other areas. For example, here at hiline, we’ll already have a full view of your finances if we provide you with other services, making HR & payroll a seamless addition.

A Dedicated Account Manager

Sure, robo accounting software can help you understand the basics of your day-to-day figures. But it’s nowhere near ready to be there for you if an unplanned crisis were to hit. For comprehensive financial services, a dedicated account manager should definitely be part of your business financial planning strategy.

The bottom line is that when unprecedented things happen, you need a real person there to work things out.

And a dedicated account manager isn’t only crucial during challenging times. Every business needs to be best-poised to succeed in a highly competitive business landscape, by using the most effective financial planning and strategy possible. That level of guidance simply isn’t possible from just a software package. You need to have experts on call to give you the best financial advice possible, and to do more than just balance your books.

When you do have a dedicated account manager and you’re receiving individualized services, you’ll be best equipped to handle unpredictable and challenging situations.

In a post pandemic world, what resources exist to help my small business?

Despite the struggles and massive challenges that came with the pandemic, there’s now some good news: we’ve all learned a lot since then and there are more incredible resources now than ever before which can help your small business create a top-tier resilient financial strategy. 

Comprehensive outsourced financial business services is one of those resources. Small business owners now understand that financial matters shouldn’t be fumbled through and shouldn’t be done with patchwork solutions and guesswork. 

Instead, there are high-value outsourced services that exist, which are run by professionals who are passionate about getting those services right.

That’s why we’re here. We’re hiline, a one-stop-shop of cloud-based financial services, here to make sure your business can run full-speed-ahead. 

Helping businesses make the right decisions so they can stay afloat during unprecedented times is one of the things we do best.

Unprecedented challenges are never easy to navigate, but the last thing your business should be struggling with during these times is your basic financial needs. When the going gets tough, you need to have accurate and helpful business financial services in place so you can focus on making the right decisions to stay afloat.

From accounting and bookkeeping to virtual CFOs, we offer a wide array of business financial and tax services that will help streamline your operations, and ensure that you can focus on doing what you love.

Interested in learning more? Contact us today and we’ll set up a call.

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