5 Tips for Playing Catch Up With Your Business

Posted by Karen Erdelac on Aug 31, 2015
business issues
It doesn't take much for a small business owner to get behind on financial obligations. A slow week, a broken piece of equipment, or losing an employee and having to pay overtime to others can all lead to a spike in costs that can wipe out profits and sometimes even leave owners unable to pay their obligations.

After falling behind, you may be playing catch up for months to get back on stable footing with your finances. Here are some tips for playing catch up so that your business functioning isn't adversely affected.

1. Make a Written Budget.

It is amazing how many business owners don't have a clear picture of where their money is going. Writing down exactly what all your expenses are will help you understand how easy or difficult it may be to get caught up on your obligations and start making a profit again. Usually, a budget lists income and expenses, but for many businesses, income will be somewhat unpredictable. You can estimate your income based on an average or on the same time of year/season for the previous year, or you can do a variable budget that prioritizes which things to pay first, then others to pay as your income permits.

2. Cut Costs Where You Can.

Times when you are behind are great times to cut your costs down to absolute necessities. Maybe your cleaning staff could skip the slowest day of the week. Maybe you work the cash register yourself a few days a week instead of paying staff to do it. Maybe you switch to cheaper coffee in the office coffee machine for a while. Whatever it takes to get your costs down, it will be worth it if it helps you get caught up. Some of your cuts might hurt, but look at them as a temporary means to an end.

3. Reach Out to Creditors.

If cutting costs still isn't enough to get you caught up, call each of your creditors and explain the situation. Don't go into too much detail, but do communicate that you have fallen behind and are taking steps to get caught up. Many creditors will work out a payment plan with you, which almost always gives you a break on late fees and interest on your balance. Just be sure not to agree to anything you can't actually do, because creditors will become less patient and accommodating if you don't follow through on your agreement.
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4. Maximize Profits.

If there are any steps you can take to increase your profits without putting more money into the business, this would be a great time to do so. Selling off excess inventory, even at a discount, having a sale to get more people buying, or using social media to market your goods and services may help to make up the shortfall that has caused you to get behind.

5. Find Alternative Funding.

Additional funding like a business cash advance can give you the cash infusion you need to meet immediate needs like paying suppliers or making payroll while you work on getting back to solid footing. Quikstone Capital Solutions gives cash advances to qualified businesses and can help you get caught up so your business can continue to thrive.

Topics: Funding Your Business, Growing Your Business