There are several key strategies you can use to better prepare your business for economic instability. Watch our Ask a Banker video to learn more.
The “Ask a Banker” series features our knowledgeable team of bankers and staff answering your questions in their area of expertise. In this video, Loren Sarno, a Senior Relationship Banker at Santander, shares her expert insight on steps you can take to better prepare your business for economic uncertainty.
Readers should consult their own attorneys or other tax advisors regarding any financial or tax strategies mentioned in this article. These materials are for informational purposes only and do not necessarily reflect the views or endorsement of Santander Bank.
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Hi my name is Loren Sarno and I am a business banker at Santander. And my question is what can I do to prepare my business for economic instability?
Analyze your current P and L and compare it to last year. Determine what aspects of the business are thriving and what provides you with the highest return on investment. Also determine what products and services yields the greatest profit margins and take into consideration If you should make or plan to make any future adjustments. Evaluate your client base - ensure that you always have a diverse mix of customers and appeal to new customers as well. Be prepared to continuously reinvent yourself and your business.
Reduce and eliminate discretionary expenses. If an expense doesn't immediately impact your bottom line, you should reduce and eliminate that expense for now. Keep your inventory as low as possible. And as far as managing debt, pay off the highest interest loan first, and avoid taking on additional debt if possible.
Set yourself up with access to working capital and keep existing credit lines open. Monitor your personal and business credit scores frequently and dropping credit scores will impact future rates for lending.
You want to make sure that you also utilize all of your resources: your CPA, your financial consultant, and of course your banker. Ensure that you have the best. If you don't interact with these people on a regular basis, make sure you connect with them and discuss your specific business needs.
For more ideas to help run your business visit sometime dares business first business hub dot Santander bank.com.