Why Businesses Need To Start Thinking About Growth?

Over the past year, the Covid-19 recession has changed millions of lives – and businesses, for the worse. For most SMEs across the country, trading has failed to even teeter close to expected projections and sadly, thousands of viable companies were swept away with the pandemic tidal wave none of us ever saw coming.

For many businesses that managed to anchor down and keep themselves afloat, operations and profitability remained stagnant, with finances taking the biggest hit. It’s not only businesses that have suffered but also the great people within them that made these organisations so successful in the first place. As the pandemic spread, redundancies soon became a mainstay of 2020, and even with the government’s widely praised furlough scheme, team morale floundered severely.

Emerging From The Covid Shipwreck

Understandably, you’re frustrated. You might not have traded at the expected outlook last year and, if that’s the case, 2021 isn’t going to be an overly smooth ride either. But if you’re still in the game, then that really is something, as hundreds of thousands of businesses have already succumbed to Covid-induced bankruptcy.

Research from last September found that 25% of businesses believed they were at risk of closing within the next six months, with 234,000 having already permanently ceased trading. The research also discovered that Covid will cost small businesses almost £12,000 on average, totalling nearly £70 billion and that 35% had borrowed cash from friends and family.

For the majority, the best-case scenario has been business survival and, for those SMEs that have managed to emerge from this global pandemic, survival should no longer be the baseline for which they measure themselves. Growth is now the next challenge, and it is once again one we’re all facing.

Though perhaps we shouldn’t view growth post-lockdown as a challenge and instead see it as a huge opportunity – people are desperate to return to normality and, with restaurants having opened again (albeit outside only), we’re all getting a taste of what our former lives looked like.

We’re Inching Closer to Normality, So Strike While the Iron Is Hot!

It’s true that fortune favours the brave, and those businesses who take calculated risks (emphasis on calculated here…) are more likely to reap the benefits than those who do nothing in a bid to play it safe.

Yes, you’ll need the courage to push forward, especially during times where your profitability has looked bleak. Millions of businesses have taken a financial hit over the last 12 months due to the pandemic and consequent national lockdowns, but you must stride forward confidently, as you will need to make some difficult decisions to get ahead in life. It might seem easier to take things slow and only fully open once every other business has, but trailing behind won’t support growth plans you might have and could even hold your business back.

Normality is well on its way, and there is an ever-increasing awareness about it. People have felt locked up in cages for over a year, and the freedom we once took for granted is nearing closer every day, so use this time to push your business forward into a period of growth.

Whether it’s going out for dinner, watching a film or getting a much-needed spa treatment, people want things to feel like they did before, and your business can play a pivotal role in making that happen.

Re-evaluate the situation your business finds itself in, decipher what needs to be done to get back on track, then do whatever is necessary and within your means to make sure it happens.

Adapt Your Budget To Overcome A Crisis

You know how that old adage goes… “Improvise. Adapt. Overcome.” Now, we’re not suggesting that you pay heed to every inspirational meme you come across on your LinkedIn timeline, but these phrases stick around for a reason – and it’s because they tend to make sense to the masses!

Yes, 2020 didn’t go to plan for most. Yes, it’s likely your business plan is now a little redundant… and yes, your finances may be tight, but that doesn’t mean it’s time to throw in the towel. If you’re one of the many businesses that had to close temporarily, your cash flow forecast is likely to be outdated, so we recommend that you focus on reworking it so that you have a better idea of where to start.

When preparing your cash flow forecast, you will, of course, need to account for the decrease in income and then plan accordingly – that might mean tightening the purse strings and limiting company spending for now.

Whilst you’re on the task, you’ll also want to prepare a cash flow statement – this differs from a cash flow forecast in a few important ways. A cash flow statement provides critical information about your company, namely how much money has flowed in and out of it. A cash flow forecast is a prediction of what is expected to come in and out of the business. Both will need to be tweaked if prepared prior to the pandemic.

Once you’ve re-evaluated your business finances and figured out a roadmap for how to drive it forward, you may well realise that you’ll need to increase your current loan facility limits or even obtain a brand new business growth loan entirely.

There is plenty of support out there for businesses wanting to achieve growth after a stagnant year, including money lent against your card takings and even your business’s unpaid invoices.

With a Nucleus Business Growth Loan, your business can borrow between £3-50k and pay the money back within a year. If you decide you want more, you can apply for quarterly top-ups to keep your cash flow on track. Apply now and get a same-day decision so you can achieve those long-awaited growth plans after a year most of us would happily forget!