Counting the pennies to survive the recession
Counting the pennies to take care of the pounds has never been more vital than during a recession, as Mike Jenkins, business development manager of Welplan and group co-ordinator of HVCA Business Plus, explains.
Is the recession nearly over? It would appear that the housing market is beginning to settle, an indication that the economy is improving, but unemployment is still rising and predicted to do so for the foreseeable future. In October the Chancellor of the Exchequer, Alistair Darling, clearly stated: ‘Some are tempted to think the crisis is over. It's not.’
This opinion fits with the experience of MBS readers — a recent MBS online poll asked if its readers had noticed if the building services industry is starting to pick up again. A large majority (64%) said they had experienced no change or that things were actually getting worse.
One thing is certain: building-services businesses need to take action to ensure they survive this recession.
HVCA Business Plus published a series of four ‘Better business guides’ to help businesses through the recession. The first lists 10 simple tips to survive the recession — the first three of which are: Count every penny, Get paid, and Credit Checks.
When the recession hit and banks pulled in the reins, it was a cash-flow problem that sealed the fate of many businesses. It is essential that you maintain a healthy cash flow.
This means, first, that you must know where every penny goes. Re-evaluate your business, examining old practices and habits and consider streamlining. Most businesses can cut costs without customers even noticing.
Second, get paid! Some businesses feel awkward asking regular customers for payment, but getting paid is vital. It is crucial that you get your invoices out on time and that you get paid for the work you have done. The Government has appointed a new chief construction officer to support the construction industry, and many are calling for his first task to be tackling the late-payment culture blighting small businesses. Don’t wait for someone else to take action. Get the money in!
Third, credit checks. It is sensible to carry out credit checks on all customers and suppliers as a regular business practice. During a recession it is essential and could save you time and money at a later date.
The HVCA, together with all its subsidiary companies, provides a great source of advice and guidance, presenting reliable and affordable ways of improving your business’ efficiency and profitability. HVCA members have access to advice and guidance on employment law, people management, systems and procedures.
For more details visit the special hvca web site below or freephone 0800 9171541.
