What steps can I take to improve my business’s financial health?

Receiving a loan for your business is critical to ensuring sustainability, and even more so to achieving long term growth and funding your business’s journey to profitability, so improving your business’s financial health is crucial.

Here are some key actions to consider:

• Keep Accurate Financial Records: Ensure your accounting ledgers are up to date, record and track as much income and expenses as possible, and prepare and issue your financial statements in a timely manner.
• Regulate Cash Flow: Ensure that cash inflows are steady by promptly invoicing clients, and promptly follow up on any outstanding amounts owed.
• Control Expense: Take a look at your operations expense, and hunt down wasteful expenses or unnecessary purchase.
• Increase Sales: Diversify your product or service offerings, find more customers to buy your product or service, and invest in marketing and advertising.
• Manage Profit Margins: Expect profit margins due to pricing strategy changes, waste reductions, and better efficiencies to help stretch out of your resources.
• Decrease Debt: Compound interest rates can create a cycle of debt that your business cannot recover, so repay all high interest loans as debt arises.
• Build Reserves: Opt to keep some reserve of your profits aside for emergency purposes. It could be to use as capital asset for your business later down the path from now.
• Strengthen Credit Profile: Paying your bills on time, and keeping your fixed debt-loans paid on time will strengthen your business credit profile.

Regularly reviewing performance and seeking help to focus on your financial chronicling can help better to identify weaknesses, and create and implement strategies.

Comparing your business’s performance to industry metrics over time will let you identify where you need to improve things in your operations.