Financial Tips For Businesses In 2021

StrategyDriven Managing Your Finances Article |Financial Tips|Financial Tips For Businesses In 2021As a business owner, it is always important to be intelligent with your finances in order to maximize your bottom line. For many, 2021 is when financial intelligence and careful management are critical with many companies struggling due to COVID-19. The businesses that manage to succeed and come out the other side in a strong position will be those that are intelligent with finances during this time, so what are a few helpful financial tips for businesses that can help right now? Keep reading for a few tips that will hopefully help to improve your company’s financial health in 2021.

Go Through Regular Expenses

One of the first steps to take is to go through all of your regular expenses and to see if you could either cut out the expense or make savings by changing. Keep in mind that cuts and changes could make work harder for staff and/or impact the quality of the product/service you provide, so it is important that you make intelligent cuts and changes that won’t negatively affect the business.

Outsource To Address Staffing Issues

If you find yourself with staffing issues during COVID-19 (like many), it can be hard to know what to do. Hiring new staff can be a huge expense, so instead, a good alternative is to outsource aspects of your operation to specialists. This can lighten the load for your existing staff and ensure that the work is being completed by a specialist without paying expensive employee costs.

Embrace Remote Work

Most businesses have had to experiment with remote work during the pandemic, and many have found that it benefits all parties. One of the main ways it benefits the business is that it helps reduce costs, and you could even downsize or go without a central office once the lease expires to free up a huge amount of money.

Sell Unused Equipment/Buy Second Hand

If you have any equipment that you no longer need, you could look to sell this to raise some extra cash. Alternatively, if you need new equipment for your business but don’t want to spend a fortune on new equipment, you could look to buy second hand. This is a smart way to keep costs down while making key improvements to your business – click here to find more about selling and buying used equipment for your business.

Look Into Solar Power

The world is becoming greener, and every business should be taking action to reduce its environmental impact. One of the most effective ways that you can do this is by switching to solar power, which will not only greatly reduce your environmental impact but also help you to make huge long-term savings. The upfront costs can be high, but ultimately this will prove to be a smart financial investment and help you improve your green credentials in a time when today’s consumer is selective and eco-aware.

Take Out A Loan If You Need It

Many businesses owners are reluctant to take out a loan, but it can actually be incredibly useful and help companies to manage during challenging periods or to cover growth plans (such as the cost of solar panel installation). There are lots of different options in terms of types of loans, so it is important to research each one and find the right type for your business and needs.

Negotiate With Vendors

You might also find that now is a smart time to negotiate with vendors. The pandemic has affected every person and business in different ways, so you might find that they are willing to renegotiate terms and rates that could help you to free up costs. Additionally, if you are coming to the end of your contract, it is worth exploring your options.

Invest In The New Normal

It is also important to realize that things will not simply be “business as usual” and that some changes are here to stay. This means that it is important to invest in the new normal and to adapt your business so that you can thrive in a post-pandemic marketplace, which might include contactless technologies, remote work tools, online services, and more.

Hopefully, these financial tips will come in handy and help you to make smart financial decisions during this challenging time and come out the other side in a strong position to find post-pandemic success. It’s not going to be easy to succeed in this industry due to the effects of the ongoing pandemic, yet these tips can help make it more manageable.

How To Finance Business Growth

StrategyDriven Managing Your Finances Article |Finance Business Growth|How To Finance Business GrowthYou can start and grow a business with very little money. In many cases, however, you will be able to grow your business more quickly if you can invest in its growth. With that in mind here are five options to consider for financing business growth.

Barter with other businesses

Bartering may sound old-fashioned. In actual fact, however, it’s very much alive and well and can work brilliantly for businesses. The key to successful bartering is to know the value of what you’re offering and make sure that you’re getting something of (approximately) equal value in return. This does usually involve some trust so it tends to work best with businesses you know.

Monetize your business assets

In the real world, bartering is good but it will generally only take you so far. Ideally, you want actual cash income. You may be able to get more of this by monetizing what you already have. For example, if you have real-world space, you may be able to sub-let (some of) it at least some of the time without it negatively impacting your business.

If you’re operating purely in the cloud, then make sure you monitor your real-world usage carefully. Act promptly to scale your resources up or down. This ensures that you are always paying for exactly what you use. Remember, a cent saved buys as much as a cent earned.

Apply for grants

This one can be hit or miss but if you hit it’s often free (or very affordable) money. It’s therefore always worth keeping your eyes open for business grants. Businesses that can demonstrate some level of social responsibility often get priority for these. Similarly, grants are frequently offered in line with general aims, for example helping businesses to be more sustainable.

Get business credit

The key to getting business credit is to work on the assumption that you’re going to need it. If it turns out you don’t, then your preparations will have benefitted you anyway. If it turns out you do, your preparations will benefit you even more. Preparation number one is to polish your credit record to a fine shine.

As soon as your credit record allows, get a small amount of business credit, like a business credit card with a low limit. Use it regularly and responsibly. This will keep pushing the needle on your credit score in the right direction.

Invest for your business

There are two ways you can do this. One is to invest personally but to divert (part of) your profits to your business. The other is to have your business own its own investments (assuming you’re incorporated). You could use a combination of both.

In either case, there are two key points to keep in mind. Firstly, you need to act mindfully. This means that your investment strategy has to be tailored to your goals. For example, is your aim to maximize capital growth or to maximize dividend income?

Secondly, your choice of trading platform does matter so do your research before you pick one. FXGlobe reviews are a good place to start. Fees are (very important) but so is the user experience. This includes security both in terms of regulation and in terms of cybersecurity.

How Your Personal Credit Score Could Affect Your Business

StrategyDriven Managing Your Finances Article |Personal Finances |How Your Personal Credit Score Could Affect Your BusinessWhile your business and you can be two different entities, your personal credit score can affect your ability to do business in a wide variety of ways. But there is one area where it will affect you the most, and that’s when trying to get financing. Most institutional lenders will look at your personal credit score first if you haven’t had the time to build your business’s credit, which could make getting capital early on very difficult.

Thankfully, there are things that you can do to circumvent these obstacles and still have a chance of getting financing for your business. In this article, we’re going to show you the exact effects of bad personal credit on a business, what you can do about it, and how you can build your personal credit as fast as possible.

Why is My Personal Credit Score So Important?

A lot of business owners assume that their personal credit score will have no effect on their business. While your business credit score and personal credit score will be calculated differently, your personal credit score still says a lot about you. Ultimately, how you treat your personal credit will be used as an indicator of how well you manage your money in general to financial institutions. After all, if you can’t manage finances in your own life, how can you expect them to believe you’ll be able to manage them in a business?

In addition, there’s really nothing else institutional lenders can go by when assessing your creditworthiness. The only way they can tell is by looking at your credit score, which is pretty much like a financial report card. It also gives them a glimpse into your character, hence why some employers will ask for access to your credit report before they hire you. Your credit report is just another factor in the balance they will use to evaluate not only your ability to repay but what kind of person you are.

Your Credit Score Doesn’t Hold the Same Weight in Every Situation

However, you should know that your personal credit score will not be as important with all lenders. For instance, angel investors or venture capitalists may not place much importance on your credit score. They may look at things like revenue, margin, viability, and even your personality and knowledge of the business first.

On the other hand, if you were thinking of getting an SBA loan, your credit score will have to be at least 680 to even apply, and other factors will be used afterward. The same goes for term loans, or what people usually think about when talking about business loans. Credit score requirements will usually be around the 680 mark as well, even though they might vary from institution to institution.

If you have steady cash flow but didn’t have time to build your credit history yet, short-term loans might be a good option for getting fast cash approval when a business requires funds in urgency. Short-term lenders will usually put more importance on business revenue over your credit score and might be more lenient. However, note that the interest on these loans is usually much higher and that you’ll have to deal with shorter repayment periods as well.

Invoice factoring is another way to get advance money for urgent expenditures, but not really for long-term financing. Invoice factoring allows you to get an advance on an invoice due in exchange for a fee. In this case, the invoice will be used as collateral for the loan, so your business won’t be as closely scrutinized as with other options.

What Can I do to Repair my Credit?

There are plenty of things everybody can do to correct their report history. The first thing is to take account of your current financial activity and commit to adopting more responsible payment habits. That could mean setting up automatic payments on your bank accounts and taking steps to fix accounts that might be delinquent.

You should also make sure that you get a copy of your credit report from all major credit reporting agencies. You are entitled to one free copy of your credit report per year from the three major credit bureaus: Experian, Equifax, and TransUnion. This will not only give you a clearer view of your accounts but help you to see if there are any errors there that could negatively affect your credit.

For instance, in some cases, an account that you paid off may not have been reported as such on your credit report. Or you may find that someone opened a credit account under your name without your permission. If that is the case, you could put a credit freeze on your account and stop any other inquiries to make sure no other demands get through. Once this is done, you can follow the dispute process and get these errors removed.

Adding new tradelines to your credit is also a great way to build or fix your credit. Tradelines is when you add any new credit account to your report. One of the easiest ways to do so is to apply for a secured credit card. A secured credit card will allow you to get approved by leaving a certain amount of money as collateral. The credit amount will usually be equivalent to the money deposited, but the issuer might decide to increase your limit if you have a good history or upgrade you to a regular credit card later on.

Fix your Credit By Buying Authorized Tradelines

Another thing you could do that a lot of people aren’t aware of is actually buying positive tradelines that will be added to your credit account without even applying for credit. Some services will allow you to pay in exchange for being put as an authorized user on someone else’s account. When you become an authorized user on someone account, the account’s activity will be reflected in your report, which will have a positive impact on your credit score. This is why it’s very important that you know what makes for a great tradeline and which one you should avoid. If you want to know how and where to buy tradelines, you can check this article to learn more.


Less than stellar personal credit can and probably will have an effect on your chances of getting financing early on as a business owner. However, with the tips we just provided, you should be able to fix your credit situation and gradually improve your creditworthiness with potential lenders.

Credit Dependency And How To Reduce It

StrategyDriven Managing Your Finances Article |Credit Dependency|Credit Dependency And How To Reduce ItBeing able to rely on credit to help you make purchases and achieve your dreams is something we are fortunate to have. As saving huge sums can be time-consuming and difficult for some to do regularly, being able to take out a loan or get approved for a credit card helps bridge the gap and speed up the process. However, there can be too much of a good thing, and becoming credit dependent is not an ideal situation to be in. So, how can you avoid becoming credit dependent and what can you do to reduce your reliance on borrowing?

Borrow Only When You Need it

If you are in the habit of borrowing money regularly, whether it be to maintain a certain lifestyle or make purchases you otherwise couldn’t afford, this is a sign you have a credit dependency. Ideally, you should only be choosing to borrow money when you really need to, for example, in an emergency when you have no available savings. Payday loans UK lenders are available for this reason to provide short term help when the unexpected happens. Borrowing this type of loan when you have no other available options is more justifiable than continuous borrowing for non-essential reasons. If you can avoid borrowing money to pay for purchases, this will reduce your credit dependency.

Start Saving More

The quickest way to reduce your overall credit dependency is to boost your savings each month. The more money you have put aside, the less you will need to rely on borrowing. If you are someone on a low income, the amount you can save maybe less than others, but even a small amount is a start. Eventually, you will have enough savings to cover any unexpected expenses or to put towards larger purchases such as a deposit on a property or vehicle. Whilst it can be easy to take out credit for big-ticket items you want, having money you can put towards a larger deposit will help decrease how much in total you need to borrow.

Review Non-Essential Spending

One of the main issues for those with credit dependency is having very little disposable income. If the majority of your income disappears quickly each month, leaving little for anything else, this could indicate your finances are overextended. The best way to find out why is to review your expenditure so that you can discover exactly where your money is going. What many people may find is once their essential bills are covered, they in fact do have disposable income but this has been depleted due to non-essential spending. It can be easy to spend a little every day without realising how much in total you are spending throughout the month. If need be, set a budget of how much you want to save from your disposable income and what you can spend on non-essential purchases. This way, you’ll reduce how quickly you run out of money each month and your credit dependency should reduce too.

Once you become dependent on credit, it can be difficult not to stay in this cycle. The risk can be eventually falling into financial difficulty where it will be even harder to resolve. By taking steps as soon as possible to reduce credit dependency, you can reduce debt and put money towards your financial goals.

Thinking about expansion? 6 considerations to help you decide

StrategyDriven Managing Your Business Article |Business Expansion|Thinking about expansion? 6 considerations to help you decideIf you’ve been fortunate enough to withstand the financial shocks which rocked many businesses in 2020, and even managed to thrive, you may be thinking that this is a great moment to expand your business. Assuming that you have already had a good idea of the direction you want to go in, just ensure that you’ve taken the following into consideration in your planning.
Are we focused on our core business?

A strong recovery is forecast by many analysts but is by no means guaranteed. What are the factors that have created your success so far? Given the climate of uncertainty, building on your core strengths will be far less risky than venturing into the unknown. That means delivering more of the same, but better and faster. Of course, if you’re an entrepreneur with an idea for a product or service that will disrupt the market – decide whether it’s a risk worth taking

Do we have adequate finance in place?

While recovery is still uncertain, it simply won’t be enough just to cover direct costs of expansion. If your customers have been affected by the prolonged pandemic response, could this have a knock-on effect on your business? Ensuring you have the finance in place to carry you over a period of suppressed demand is essential. Specialist companies such as HS Finance can help with secured business loan applications to make sure you don’t find yourself in a cash flow crisis after making a significant investment in your expansion.

What about workspace?

Are your current premises adequate, or will you need to find larger ones? Or, could you reduce the amount of space you use? With the increased need for social distancing, and many people now working from home, at least part of the week, expansion may result in reduced costs.

Investing in people

Linked to the above. If you’re shifting to a remote working model, keep in mind the duty of care you’ll still have for your home-working employees. They’ll need appropriate tools and equipment to do their job efficiently and safely. Make sure you include these expenses in your plan, along with additional training and support.

Are your systems fit for purpose?

When you expand, will your current systems be able to cope? Ensure any new software you invest in is scalable. New cloud-based PaaS systems, such as MS Azure, are cost-effective, flexible, automatically updated with the latest apps and services. As they typically charge on a monthly, by-usage basis, there’s no need for huge up-front investment.

Do we invest in marketing?

Once you’ve expanded, you need to get out there and sell! How are you going to let customers know about your new services? Is your webpage up to scratch? How are you managing social media for maximum exposure? Consider factoring in the cost of a marketing company into your plan to help generate the best return on your investment.

To be considering expansion, it’s clear that you’re energized and optimistic about the future of your business. With careful planning and a healthy dose of realism, you’ll be ready to reap the rewards of your hard work.