TL;DR: During a downturn, prioritize preserving cash over profit, since running out of cash kills businesses more often than taking a loss does. A CFO builds financial forecasts from past performance to guide strategy, and cash flow forecasting should go hand in hand with sales forecasting so the company stays liquid. If you’re preparing to exit, concentrate on profitability and keep clean records.
Most importantly, Rob te Braake, Abel Finance CFO, joins us to discuss finance strategies for FBA and eCommerce sellers. Preparing contingency plans and tops for long-term digital business success and increasing cashflow. Of course, rob also shares his predicted outcomes of the CoronaVirus pandemic for eCommerce owners and advice on curbing the worst of it. This guide covers key aspects of stay afloat.
HOW TO STAY AFLOAT THE COVID-19 – WHAT YOU’LL LEARN
- The role of the CFO
- Common mistakes of FBA and e-com sellers in finance
- Importance of the cash flow
- Changes brought about by the Coronavirus
- Increasing profitability
KEY POINTS
- Looking and the past financial performance of the company, the CFO makes the financial forecasts that provide input on the company’s future strategies.
- Entrepreneurs need to balance their natural optimism with negative possibilities and be prepared to deal with it.
- There is a need to also draw attention to the cashflow as most businesses become bankrupt not from loss but from running out of cash. To clarify, in addition, there is a need to understand and manage the flow of money ensuring that the company is liquid and is able to respond to payables and emergencies.
- Cash flow forecasting goes hand in hand with sales forecasting.
- Current coronavirus situation will definitely change consumer behavior and may lead to recession. In this time, it is important to focus on preserving cash and not profit.
- Understand the different financing options, especially drawbacks from each.
- An exiting business would need to concentrate on profitability and good records meaningful to the buyer.
- Send your inquiries about finance strategies at rob@abel-finance.com. In summary, you can also visit the Abel Finance website for more information.
80+ in-house specialists across PPC, supply chain, account management and content.
RELEVANT MATERIALS
- The Impact of Coronavirus on Global Workforce
- Diversifying During a Global Pandemics
- Maintaining Cashflow During Covid-19
- How to Prevent Fail During Crisis
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