3 Strategies To Increase Profitability During A Recession

May 14, 2020

With the right strategies, you can increase your profits during a recession. No one likes seeing the economy in a downward spiral, but sometimes this phenomenon is inevitable, such as Increase Profitability During Recessionduring a time of crisis.

What Does Profit In A Business Mean To CFOs?

The CFO’s job is to manage your numbers to help you turn a profit. They look towards the future so that your business can grow in the long-term. Your ideal CFO is a leader in your company that turns the tide.

To a CFO, profit means that they have introduced vision and clarity to your business. You also have a healthy and sustainable enterprise, which looks good to potential investors. When you can attract capital for future investments and emergencies, then you are in good shape.

How To Increase Profit In A Business?

We believe you can increase profit by keeping your processes and operations simple. Reduce your accounting infrastructure and ensure that business activities are not too complicated. Otherwise, administrative costs increase with the time that managers have to input on a regular basis.

You want to keep your admin operations lean. That way the investments can go into creating products and services and finding customer leads. With that said, there are other strategies that you can implement in the case of an economic downturn.

Strategies To Increase Your Profit

Maintain Or Increase Your Advertising

During a recession, your competitors and other businesses will be cutting back on advertising. This takes them out of the public eye. As a result, they become less reliable and relevant to the designated target audience, while advertising networks need to reduce their charges towards companies.

Take advantage of reduced advertising costs to maintain or increase your spending. You’ll get better deals and people will remain aware of your brand. They’ll think that you are strong and reliable, and stay with you.

Track Your Cash Flow

Cash is king; that is one of our mottos. When your business has incoming revenue streams that outnumber what goes into paying bills and other costs, then you remain in the black. The minute you run out of cash, it’s game over. You have to close up shop or file for bankruptcy.

See how cash is incoming and outgoing through your business. Where do you spend the most, and which products or services are bringing in the most revenue? Where can you make cuts? See if you can negotiate lower deals on rent and utilities with your landlord and power companies.

Check Your Credit Score

You want to have good credit for your business, for two reasons. A healthy credit score allows you to borrow against your debt. This works when you need emergency cash in a hurry, or when you want to expand your venture to take advantage of new opportunities.

Conversely, a low credit score does not just mean that you are locked out of good loans. It also could signify unpaid debts or a negative reputation in the financial sense. You want to avoid phone calls from collections and creditors

Protect Your Business In The Long-Term With Deep Sky

DeepSky wants to ensure that you can survive any financial crisis. Our team of specialized accountants and outsourced CFOs will ensure you received customized services at a fraction of the price. Our Financial WingmanTM program is designed to assist you

Reach out to us today to get started. DeepSky is ready to help you make your business recession-proof and take your profits to the next level.

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