If there’s one thing that’s marked the past few years, it’s economic uncertainty. Inflation rose sharply in 2022, leading to increased interest rates and an unstable stock market. The word “recession” gets tossed around frequently these days.
As your company’s CEO, you want to do whatever you can to help your business weather any economic unknowns and cope with prices that seem to keep on climbing. A virtual CFO can help you find ways to strengthen your company’s finances, so it’s ready for whatever the uncertain economy throws at it next.
Revise Your Strategies
Every business needs a strategic plan, but it’s important to remember that your plan isn’t written in stone. You may need to go back and change it occasionally as circumstances change.
If your business costs are increasing, you may need to adjust your strategy to find ways to bring in more revenue without alienating your customers. You may need to explore other sources of financing you didn’t previously consider.
Whether you worked with a virtual CFO when you created your strategic plan or not, they can be a great resource to you as you revise your plan. You’ll benefit from the vCFO’s expertise and knowledge without having to pay the cost of hiring a full-time executive.
Reduce Operating Expenses
Reducing business spending is always a good move, particularly in times of uncertainty or higher costs.
But, you’re probably wondering, where can you make cuts? A vCFO can help you decide. In some cases, cutting costs just isn’t worth it, while in others, your company can save big.
Cutting operating expenses goes beyond cutting the cost of products you purchase. It means taking a holistic view of your company’s overall expenditures and spending. It could be your labor costs are high but your employee output is low. Increasing employee engagement and productivity can help you lower costs.
A vCFO can also help your company negotiate with suppliers or help you find ways to optimize your taxes to further reduce expenses.
Improve Your Products
When things are up in the air and you’re not sure what the future holds for your business, it helps to take a close look at what you’re actually offering. Is there a way to make your products better, so that people can’t live without them?
One option might be to explore ways to offer higher-end, premium products to customers, so they can get the most value from them. Another option is to bundle your products together, so people purchase more at a time.
Switching to a subscription model can be another way to go, as it keeps customers coming back month after month.
Although you may not know what’s going to come, you don’t have to navigate economic uncertainty in the dark. A vCFO can help you stay ahead of rising costs and an unstable economy. Contact New Direction Capital today to see how our vCFOs can support your company.