Supporting Businesses and Your Employees with Practical Solutions
The cost-of-living crisis is affecting everyone: businesses and their employees. By taking proactive steps during these challenging times, businesses can help ease the impact of the crisis and emerge stronger in the long run with loyal employees.
Building a Resilient Business
- Ensure you have real-time financial information at your fingertips, and zero in on those major business costs and explore where there might be room to cut back. Use a cloud-based system such as Xero to access information anytime from any device.
- Make informed decisions about the future of your business with a well-crafted budget and forecast. Apps like Futurli, Syft, and Float make this easy to do – plus they integrate seamlessly with Xero and QuickBooks. Your accountant can help explore these further
- Review your current costs, are they really essential? Do you still need to subscribe to a business magazine you never read?
- Can you cut back? If you have an office, look at your energy usage E.g. ensuring unused lights and plugs are off.
- Review your supply chain and ensure you are getting the best price and service
- Look at your service offering and stock sales – consider cutting underperforming items, reducing waste, increasing prices or diversifying. Look into apps to track income and costs by project.
- Review payment terms with customers to incentivise payments on day 1 or on time and highlight late payment penalties. Automated credit control apps such ‘Know-it’ that links with bookkeeping software can help to manage accounts receivable.
- Review payment terms with suppliers – discuss credit terms with suppliers but remember everyone is feeling the pinch so delaying paying a supplier (especially a small company) can potentially damage their business.
- Funding – local councils and Scottish Enterprise may be able to provide grants or interest-free loans to give your business a financial boost or help with growth such as digitising any of your operations.
- Look into R&D Tax Credits – a key part of the UK government’s strategy to support businesses and reward companies for innovation.
- Inflation is predicted to fall so a one-off payment could help staff cope with immediate financial pressures without committing a business to higher longer-term salary bills.
- Linking pay more closely to performance means that a salary rise at least partly pays for itself by increasing business income.
- Education about budgeting and financial decision making helps employees make their money go further and understand the longer-term consequences of potential money-saving moves.
- Offer flexible working arrangements to reduce travel costs or buy back extra holidays to accommodate personal life and reduce business costs during quieter periods
- Employers could even provide additional benefits in kind that they can access more cheaply than individual employees, for example gym membership or discounted goods and services.
- A business may be able to provide medical insurance for employees at a lower cost than employees taking out their own policies. There are also business benefits of keeping employees healthier and shortening sickness absences.
- Setting up a cycle-to-work scheme gives employees the chance to save public transport costs and may provide a tax advantage depending on how it is set up. It also gives rise to potential health benefits for employees.