By Adeife Adeoye
We are living in a time where every penny counts. A little cash could be the only thing that is keeping your business from dying. So you can’t afford to throw away any money, especially on something that doesn’t matter.
United Bank of Switzerland report shows that more than three times more businesses will shut down in five years than shut during the last recession. But we are not shocked, are we? It’s expected. Lots of companies can’t survive the economic decline, and finance is one of their significant problems.
Knowing all these, I came up with tips that can help you manage your business’ finances during the pandemic.
Get payment extensions
The Central Bank of Nigeria (CBN) has granted a one-year moratorium on all principal repayments. What this means is that any intervention loan under the moratorium has been awarded an extra one-year period. The moratorium was granted to ease the burden of loan repayment by businesses considering the significant decline that the pandemic has caused the economy.
Besides, most loan companies are working with businesses and offering payment extensions. If you find it hard to keep up with some of your payments, reach out to the company you’re supposed to be paying. They might offer you more time to make your payment or allow you to skip the payments and add it to the end of your loan.
Try a relief program
Nigeria released $136.6m credit relief to help businesses affected by the coronavirus. Households, airline service providers, hotels, health care merchants, small and medium-sized enterprises will benefit from the funds.
If you’re having a difficult time handling your business financially, you should apply for the relief program. While borrowing money might not be the ideal thing to do, especially during this time, it will help your business scale through this uncertain time.
Diversify your income
Business is slow, and you’re not earning as much as you want. So you need to look for ways to bring in extra cash, if not your business might suffer financially.
You need to sit down and get creative to bring in extra cash. There are endless ideas on how to earn extra money during this time. You can offer online learning classes or set up online shops to sell most of your products/ services. It’s entirely up to you to find new ways to make more money even when the economy isn’t smiling.
Look for ways to save more money.
You own your business; it’s your money, and you can spend it how you want. But, now is not the time for inappropriate spending. You need to save money wherever you can.
Create a stringent budget and stick to it. Check all your expenses to figure out where your money is going. Then scale down on non-essential expenses. Separate your personal and business finances. If you mix your personal and business finances, you will have financial issues.
You need to prioritize your spending. Don’t buy more than you need. Instead, concentrate on your utilities and paying your employees. The truth is you can only hope for your business to go back to normal; you can’t know when your business will pick up again. It’s better to save your money than buying things your business doesn’t need.
The COVID-19 pandemic is having a consequential effect on the Nigerian economy. It is easy to be confused with all the information out there regarding the pandemic. But if you let your guard down and make unnecessary financial decisions, you can kill your business.
I understand that you might be worried about your business’s financial state. But, it’s best to remain calm, follow the above tips and government advisories, so you can make the best financial decisions.
*Adeife Adeoye is a content writer and CEO of Penpalms (email@example.com)