5 Coping Strategies for Dealing With Financial Problems.

Tuesday, May 17, 2016 - 19:00
 5 Coping Strategies for Dealing With Financial Problems.

Whether you run a business, or are planning to, there’s one key area you need to be able to cope with effectively: your finances. Chances are, at some stage you may find your situation a little tight, either due to unexpected costs or the post-Christmas lull, or perhaps you’re simply having a bad month. Whatever the cause, when struggles come a’ knocking, you need to find ways to deal with them until you can see them on their way.

Here are five of our favoured strategies to try:

  1. Don’t panic!
    Without echoing Corporal Jones of Dad’s Army fame, try to remain calm. When faced with a tricky situation our first reaction as humans is often to go into meltdown, but if you stop, stand back, and consider the situation objectively, you will be able to approach your problems with a much more productive attitude.

  1. Reassess.
    The Chinese word for “crisis” (危机) is composed by two characters respectively signifying "danger" and "opportunity". Rather than think, ‘What on earth am I going to do now?!’, calmly consider, ‘How can I try and resolve this?’ instead. By changing your perspective, you will find you open a number of doors that could lead you not only back to an even keel, but to opportunity and growth instead.

    • So your pub isn’t pulling in enough punters? If quiz nights, karaoke and lunchtime specials aren’t working, how about doing a deal with the local nursing homes for a bi-monthly lunch and afternoon film showing? It gives them a nice day out and adds another string to your bow.
    • Your landlord’s raising the rent? Why not partner or share the space with another retailer? You may even find you complement each other well and bring in more trade that way.
    • Is your bookshop becoming more isolated and dusty than Miss. Havisham’s house? Breathe life back in by creating a comfy seating area and café. Customers spend more time browsing books, and there’s easy money in a nice cup of tea.
  2. It’s good to talk.
    Verbalising your problems with friends or acquaintances in your industry can give you more avenues of thought to mull over. If venting with someone over a coffee still isn’t providing enough clarity or direction, have a look at the wide range of mentoring opportunities in the UK. Mentor Me and the programme offered by Business Getaway are two good examples. Whilst they’re not Hogwarts and they don’t offer immediate magical solutions, they can provide wise advice to apply in the mid- and long-term.

  1. Cut some cloth.
    Make a list of all your regular incomings and outgoings, business-wise and personal. Be sure to factor in even the smallest of expenditures, be it lunches, magazines, bus fares or lottery tickets. Consider cheaper alternatives. For example, a jacket potato for lunch can cost up to £6, and even a sandwich can be just as expensive. Make your own at home for a fraction of the price and put the pounds you would have spent in your piggy bank. If you must dine out, order a starter and a side instead of a main. Cut out unnecessary expenditure: you don’t need to buy the newspaper or the latest copy of Grazia to stay ahead of current affairs and this season’s trends. If your bus providers price tickets based on distance travelled, get off a few stops early and walk. If you’re pinning your hopes on lottery tickets, put the money in your savings instead; interest accrues and you can play using that, if you must.

    On a bigger scale, it pays to shop around. Switch utility providers, insurance companies and your mobile phone contract. Using sites like Quidco will earn you cashback on everything you buy online, from as little as 5% of your purchases to cash payments of as much as £75. Get your phone, tech and travel insurance through your bank instead of paying separate companies. For example, Barclays offers tech packages for around £9.50 a month covering your mobile and laptop, plus other gadgets, and if you add a second package like travel insurance (which also includes your car breakdown cover) they give you a multi-pack discount.* This then negates the need for separate policies and saves you unnecessary costs.

  2. You are your business.
    Too many people describe their businesses as though it were an unconnected entity: the shop, the café, the language school… That shop, café or language school are part of themselves. This generally results in blame being apportioned to everyone else for their failures: if the business doesn’t work it is because of competitors, the country, politicians or even the planet we live on, but never them.

    A business is an inanimate entity – it does not have a mind of its own. As a result, in order to succeed you must be fully responsible for it and take control. Learning this will definitely give you a clearer and more mature outlook, and foster much more of a positive ‘can-do’ attitude. And when you have accepted that you and your business are one and the same, you’ll immediately become aware that the solution is well within you. The growing trend for people-run businesses, businesses that are an established part of their community with a visible human face, means that customers are given a brand they associate with their surroundings, one that they trust and think fondly of. Word of mouth will spread: before you know it, that hashtag WeLoveLocal will be a worthwhile mantra, and your business can look forward to positivity and growth.

*information correct at time of writing – May 2016

Katharine Coulton