How to Stay Financially Resilient During Uncertain Times

Plan today for a successful future

Financial resilience isn’t about predicting the future, it’s about preparing for it. Small businesses that manage cash, plan ahead, and stay adaptable can weather tough markets. Here’s how to build a stronger financial foundation and stay calm, confident, and in control during uncertain times.

1) Focus on cashflow first

Cash is your business’s safety net. Keep a close eye on inflows and outflows weekly. It is possible to be profitable but still run out of cash but planning and forecasting gives you early warning and the opportunity to do something about it before it’s too late. One local café survived the 2023 downturn by running 13-week rolling forecasts, it helped them plan stock and wages without surprises.

2) Build an emergency reserve

Aim to hold three months of fixed costs in reserve. Even if that feels far off, start small. Setting aside just 2% of monthly revenue builds a safety net over time and boosts your confidence when markets wobble. Having a safety net of this size gives you the confidence to make strong decisions and puts you at a decent competitive advantage. You can consider longer term arrangements with new clients that a cash poor competitor may not be able to survive.

3) Review your expenses regularly

Go line by line through your subscriptions, software, and services. Many SMEs uncover hundreds in forgotten costs. Make this a regular, diarised activity, especially during good times when things are going well – that is always a time when unnecessary expenses get added and forgotten about. We recently helped an e-commerce business trim a substantial amount of overheads just by cancelling unused tools, renegotiating software licenses and automating a number of processes for the team.

4) Diversify income streams

Relying on one customer or product line makes your business fragile. Explore complementary services or subscription models to create more predictable income and reduce dependency on single sources. There is research to show that actually your secondary products end up being more profitable than your first product. In addition, being able to sell multiple products to the same customers makes them extra sticky and more likely to stay with you long term.

5) Keep financing options open

Even if you don’t need credit now, maintain good relationships with your bank and explore funding lines early. It’s far easier to secure credit when you’re stable than when you’re under pressure. There is an old expression that its better to have an umbrella and not need it than the other way around. Banks really like stable, predictable numbers and a strong balance sheet. It makes it much easier for them to get past their risk underwriters.

6) Update forecasts frequently

Forecasting shouldn’t be an annual task. Use cloud systems to review live numbers monthly or even weekly. Real-time data helps you act early if profits or cash start to tighten. If you can get your information flowing well, this needn’t be an onerous tasks. The technology is there to provide you with regular reporting with minimal effort and the rewards can be very high for spotting opportunities or potential problems.

7) Revisit pricing and margins

Inflation and supply chain changes can quietly erode profit. Review your pricing regularly, and don’t be afraid to adjust. Small, transparent increases often protect margins without losing loyal customers. It is also important to be confident about your worth. Make sure you get paid properly.

8) Strengthen customer relationships

In difficult times, repeat customers are your best ally. Keep communication open, reward loyalty, and provide great service. Happy clients buy more and recommend you to others even in downturns. Most great organic businesses have grown simply through word of mouth and referrals which is without doubt the best form of marketing given it’s virtually free and the new client already has an element of trust in your business due to their referred network – all it takes is a little bit of deliberate effort to work on those relationship.

9) Invest in efficiency, not cuts

It’s tempting to slash costs, but smart businesses invest in automation and training to work better, not just cheaper. One engineering client we worked with saved 10 hours a week by automating invoicing, with no job losses. Automation will become all the more important over the coming months and years as AI starts to accelerate. If you don’t take advantage you will be left behind. Start looking into it and having conversations.

10) Get expert advice early

The sooner you ask for help, the more options you have. Your accountant can model cash scenarios, advise on funding, and find savings before they become critical issues. It is really easy to bury your head in the sand and hope that the problems go away or some miracle comes along. Pick up the phone or send that email and get the process started. Earlier is always better and no-one has ever regretted getting clarity on their position or their options.

How Love Your Accountants can help

We help small businesses stay resilient through any market. From forecasting and budgeting to cost control and funding advice, our practical, data-driven approach helps you plan ahead with confidence. Book a free consultation today to strengthen your financial safety net.