We are living in a volatile, uncertain, complex and ambiguous world. Hong Kong in particular more so since summer 2019 than ever before. From a global trade war through to social unrest, along with a recession and now the Coronavirus, Hong Kong businesses are now adapting faster than ever before to a series of fast changing events that affect our businesses. What should Hong Kong SMEs be doing today to protect our businesses and ensure our long-term survival?
There are a few simple measures for SMEs to future-proof our businesses in these abnormal times, ensuring our businesses continue to be of value into the distant future and not becoming obsolete.
These days, trying to win new contracts and secure new revenues may not be so easy. Retaining customers and minimising any lost sales is very important. With current events, now is a good time to review our costs and identify costs which are no longer required, or which can be temporarily suspended, without decreasing good customer service. These can include and of course not limited to:
- Negotiate with landlords and see if we can secure a temporary rent reduction
- Review subscription fees and identify and software licences we are paying for, but not using
- Reducing international travel costs and making the most of technology for meetings and calls
- Reviewing contracts and agreements with suppliers to see if we can negotiate fees and change of scope for services
- Review marketing costs. Do we need to spend as much as we have been
- Review insurances in relation to the business. We all need insurance, however, now is a good time if we can find or negotiate better rates
Negotiate with landlords and see if we can secure a temporary rent reduction
We should consider setting a budget and forecast for the financial year ahead. It may be difficult to predict our revenues. We can, however identify all our costs and ascertain what revenue we need to achieve to break-even and what incremental revenue is needed to achieved a desired profit margin.
Flexible Management Accounting
Having the flexibility in place is important. Fresh Accounting is a dynamic management accounting practice and consultancy with offices in Hong Kong & Singapore. Fresh believes accountants should do more than just report on how your business is doing in which they identify opportunities and strategies to improve your business and support you in improving performance and profitability. Fresh provides three distinct services:
- Monthly accounting services
- CFO & Advisory
- Implementation of cloud based accounting solutions
Employing a full-time Chief Financial Officer (CFO) can prove expensive for a small or medium sized business and you may not have the requirement for a full time professional, especially in these difficult times.
Having said that, you still need an experienced set of eyes to help you grow your business or even maintain business through the current economic climate. A flexible arrangement with clients where we work closely with you to become a valuable resource.
A CFO will work with you to understand your business and put systems in place to provide a framework that will deliver meaningful information, allowing you to maximise business performance through informed decisions.
Digital transformation and cloud based accounting solutions powered by Xero
Xero allows you to automate many of the essential, but time-consuming, accounting tasks. With Xero’s help, Fresh can take care of everything for you, so you can get on with what you’re good at. Fresh is to support business growth with Xero at the helm.
Fresh Accounting is one of Asia’s fastest growing Xero specialist and a Platinum Partners. Xero is cloud based, which means you can access your accounts anywhere, from your office to the comfort of your sofa at home at any-time of the day. There is no need to back up information or rely on one computer to access your accounting software. The interface is slick, easy to navigate and use. Bank feeds with HSBC, DBS and Hang Seng allow bank information to flow into Xero seamlessly.
There are numerous add-ons to Xero, from expense management, inventory management to project management allowing you to build and customise your own integrated cloud based software solutions.
This blog is written by Fresh Accounting team and also posted on Hong Kong Momtrepreneurs.
For more information, please click on on www.freshaccounting.biz or email firstname.lastname@example.org