- August 20, 2020
- Posted by: Hannah Johnston
- Category: Business Stategy
Assess the Financial Impact of Crisis
As a brokerage CEO, you choose the future of your business through the actions you take every day. Prioritizing the protection of your staff and your customers means you have had to pivot quickly to adapt your operations to a new way of doing business.
How about the next step? It’s time to assess the financial impact of this crisis adaptation on your current business plan. If you have already started this process – great! If not, waiting for certainty to emerge could lead you into trouble.
In the absence of having perfect information for decision-making, using assumptions to assess your potential revenue loss (best case, worst case, and most-likely case scenarios) can be powerful. Working through the steps below will provide insight and uncover items within your control to change. Completing this checklist will prepare you for the adjustments you may have to make as you hope for the best but plan for the worst.
9 step checklist to assess financial impact
Step 1: Manage accounts receivable: credit policy and collection process
Step 2: Assess the potential revenue impact (best, worst and most-likely scenarios)
Step 3: Assess revenue loss impact on earnings and cash flow
Step 4: Review other sources of revenue
Step 5: Review working capital requirements
Step 6: Review expenses
Step 7: Review capital investment commitments
Step 8: Review debt funding requirements and access to additional funding
Step 9: Create an Action Plan
We are certain that there will be no ‘back to normal’ for business owners. You will eventually re-open your business in a new way of operating, and so will your clients. The sooner you get your assessment started, the better prepared you will be when you need to adapt and make your next pivot.