How to Restructure Your Company's Finances

If your company took a hit because of COVID, it's not uncommon to still be digging yourself out. In fact, even multi-million-dollar industries suffered the rippling effects of closures and are still trying to recoup their losses. Rebuilding from scratch, or even if it seems like that, doesn’t need to be complicated. All you need is a concrete plan and the desire to succeed. In this post, we’ll go over some of the best ways to bring your business up to speed and head into 2023 on a lucrative note.

Negotiate Contracts

The first step in getting your finances back on track is contract review. Regardless of type, you need to ensure you’re not paying for products or services you could get for less. Review all current contracts with vendors before resigning. You also need to compare shop and compare what you’re paying to what similar vendors are currently offering. It’s not uncommon to find other vendors offering the same product line or service for a lot less than you’re currently paying. If it’s is the case, you have two options. You can negotiate your current contracts or let them know that you won’t be resigning when it ends.

Invest in Technology

As a business owner, you need to keep daily operations running smoothly. That means everything from how payroll is completed, to the way you keep track of your drivers must be on point. If you run a fleet, the best way to cut costs and keep them safe is with GPS technology. This high-target technology allows you to track deliveries in real time without having to pick up a phone. It also gives you a bird’s-eye view of how your employees are performing when you’re not around. Incorporating GPS into your new structure can also help you save money as well. Having it installed can ward off expensive litigation costs if any of your drivers are involved in an accident.

Choose Your Debts to Restructure

Even successful companies have debt they may want to reorganize. If that’s the case, you need to identify which debts you want to restructure. This could include rent, equipment costs, credit card handlers, and external vendors. Keep in mind that it’s not always the most expensive debt that needs to be changed. Even smaller, less costly bills or debts can be reworked or eliminated entirely. Your goal should be to free up money to improve overall cash flow.

Determine Payment Schedule

Once you identify your pain points, you then need to think about a repayment plan that will benefit your business overall. It’s not uncommon for companies to rework their finances only to fall short of being able to pay the new payments. This can then lead to a breach of contracts with external stakeholders and in the worst-case scenario, legal action. After all, is said and done, you need to make sure the repayment method you choose is one you can stick with. Also, make sure there is a clause in any new contracts you sign that clearly states that there is a bit of wiggle room for another round of negotiations if you’re unable to pay. This way, you’ll have an opportunity to rework your payment schedule without penalty.

Overhaul the Hiring Process

How you hire is just as important as who you hire. The process of hiring new employees comes at a cost, so it’s important to minimize costs throughout the process. Look for ways to speed up the search and onboarding process to save money. That may include hiring an agency for the initial screening or actually doing it yourself. The same holds true for training. Online training courses are far less than in-person sessions. You may also want to implement a buddy system for new hires for job shadowing purposes.

Consider Downsizing

Depending on why you want to restructure, you might want to consider downsizing. Note, that this doesn’t always mean firing or laying off your employees. There are ways to attract and retain talent so that you are not constantly experiencing turnover. It can be as simple as switching physical locations, doing tasks that used to be performed externally internally, or retraining current staff instead of hiring new ones. This will look different for everyone, so don’t compare your business needs to others. The goal is to improve the overall flow of your daily operations while saving money and scaling upwards.

Outsourcing   Career   Broker   Loans   Business   Investing