Cut costs or increase income?

Our colleague Sean Kelly, has years of experience working in finance and as a talented Finance Director has encountered many occasions where a business has faced cash flow challenges. The knee jerk reaction is often to race to cut costs, but there are issues here.

Unless your business is unduly profligate, there's a definite limit to the amount you can save by cutting costs without impacting business performance and customer experience.

In the area of cutting headcount, you may be losing the monthly payroll cost, but along with that goes all of the investment in training and on-the-job experience, all of the positive relationships, internal and external, and don't forget the impact on morale for those who remain.

Sean's advice is always: turn your focus to increasing sales. As fast as you can. Prove that the business is viable, make every member of staff essential.

An overhead cut will buy you a just a few short months of runway. A push on winning new business could take your business to a whole new level.