Tough times makes it imperative for frontline expertise from accountants to help businesses survive is critical, especially with companies having seen their cash reserves depleted over the past year. Most government support programmes have dried up, underscored with internal challenges.
According to Stats SA, the 2019 financial year saw the formal business sector generate a total turnover of R10.5 trillion, of which small businesses contributed R2.3 trillion. However, COVID-19 has placed many companies in distress, with many customers’ needs shifting, a surge in virtual collaboration, and the pandemic exposing weaknesses in processes and practices.
But how can an accounting practice offer support to its customers through this time of uncertainty?
Let’s consider some of the ways to help:
Review the business’ financial status in tough times
This could be an opportune time to sit with your customers and review their financial health in tough times post Covid. Look at their revenues, profits, and cash flows, and try to identify the trends observed at different points in the pandemic. Compare the numbers to previous years.
Review what happens to their sales, services rendered at various stages of lockdown, and how this impacts their ability to pay suppliers and debts?
Help customers with a recovery plan in tough times
Having reviewed your customers’ financial health, you could step in with some practical advice. Discuss where they can access finance to keep afloat if they have a gap in their working capital requirements. Help them identify areas where they could cut costs to free up cash flow.
Also, be ready to support customers who need funding in making grant or loan applications. You may need to provide key financial reports for them, for example.
Talk about the medium- to long-term vision in tough times
Most of us feel that the pandemic has changed our world for good, but we are not entirely sure which changes will be permanent or which will dissipate.
You can help customers analyse how trends such as providing online sales have affected their business and whether they can move permanently to more remote work to reduce operating costs.
For some industries such as home food deliveries, e-commerce and IT, the pandemic may have boosted rather than harmed their business. Here, accountants can help business owners review whether they have maximised the opportunities.
When the hard lockdown hit, everyone rallied together to share information and pitch in to keep their business, industry and economy going. At this stage, however, everyone is experiencing some pandemic fatigue. Yet the crisis isn’t behind us and many customers will appreciate it if you keep in touch with them. Some of the conversations you have could be more emotional than usual, but the need for pragmatic financial advice remains.
Supporting your customers
The need for a trusted adviser has never been more relevant than it is in today’s tough times . As your customers seek guidance during the continued crisis, offering support to help, their businesses keep moving is vital. Going the extra mile, you can help customers get through these strange times and position yourself as a trusted business adviser for the longer term.