In a rough economy, pretty much no one is immune to a little turbulence — that can include your small business. And the bigger and more resources you need in order to run your business, the more you’ll need to pay attention to when you try to protect it.
Below, CNBC Select outlines a few simple ways you can make your business more resilient during uncertain times. Read on to learn more.
Set aside money for future use in a savings account designed for business
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
Annual Percentage Yield (APY)
3.09% with a daily balance of $5,000,000 or below; 3.90% with a daily balance above $5,000,000
Experts recommend putting aside a portion of your revenue so you can pay taxes, but during uncertain times, do a bit more than that. Set aside any extra savings so you can weather more serious financial setbacks, like if you have a bad month with low revenue and still lots to pay for, you can use some of those savings to cover the bill.
The LiveOak Business Savings is a top business savings account because it offers a decent APY for earning interest on your balance. It doesn’t have a minimum required deposit to open an account and there’s no monthly maintenance fee.
Similarly, the Axos Bank Business Premium Savings also offers a strong APY and doesn’t come with a monthly maintenance fee. This account also offers checking account access.
Up to 6 free withdrawals or transfers per statement cycle
Excessive transactions feeOverdraft feesOffer checking account?Offer ATM card?
Axos Bank Business Premium Savings
Up to 6 free withdrawals or transfers per statement cycle
Overdraft feesOffer checking account?Offer ATM card?
Yes, if the account holder has an Axos business checking account
CNBC Select tip
When you feel as a business owner that you’re approaching hard times, it’s smart to look at diversifying your different revenue streams. This may look like coming up with another product to offer or securing one more client or opening up an additional distribution channel.
When times are tough, some of the expenses that used to feel accessible may suddenly feel like a luxury. There are definitely some expenses you absolutely need to keep in order to operate your business, especially if they directly help you make money.
But there may be ways to lower those expenses if you still need them in your budget yet also want to keep costs down. For instance, you can negotiate with vendors, downgrade some subscriptions and other tactics.
If you can’t lower the expense and it has your budget in a chokehold, you might consider cutting it out altogether if your business can still run without it. The point is to keep your business lean and eliminate expenses that will put a strain on your business during an already stressful time.
Make sure your business is insured
Contingency planning is basically a formal way of saying come up with a Plan B. In this case, you’ll want to come up with a backup plan for anything that can go wrong in your business: you lose your manufacturer, prices increase on the things you need most to run your business, rent for your storefront increases — you name it. Look at where your company’s weak spots are and address those first.
Contingency planning can help you figure out what you need to set aside money for in a rainy day fund. And if things hit the fan, at least you already know what your next step should be.
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