Resources

Financial Stability: Practical Approaches for Growth-Minded Businesses

Resources

Financial Stability: Practical Approaches for Growth-Minded Businesses

This page was last updated on March 26, 2025

While the UK enjoys greater political stability than a year ago, economic challenges and government tax measures continue to impact business growth plans.

A recent business confidence survey from the Office for National Statistics found that only 20.2% of respondents expected their business performance to improve over the next 12 months, while 16.1% anticipated a decline. The majority—63.7%—expected no change.

The true impact of April’s Employer’s National Insurance increase on employment, costs, and growth remains to be seen. So, to help businesses build resilience in the months ahead, our March Business Club explored how to maintain financial stability and keep growth plans on track.

Key areas of focus

The session concentrated on three essential aspects:

Developing robust financial strategies
Managing cash flow and costs effectively
Maximising finance, investment, and growth opportunities

Strengthening financial planning

Club members emphasised the importance of aligning financial plans with business objectives across short, medium, and long-term horizons. Financial plans should be grounded in facts rather than aspirations, with budgets regularly reviewed against key performance indicators (KPIs). Keeping cash flow forecasts updated also helps to anticipate challenges, and external experts can provide valuable insights by stress-testing financial models.

Adaptability was another critical factor. Developing contingency plans and scheduling regular financial reviews enables businesses to navigate potential disruptions with greater confidence.

Managing cash flow and costs

Preserving liquidity requires close monitoring of cash flow. Key suggestions included:

Reviewing and optimising payment terms with suppliers and clients
Assessing whether price increases are necessary to sustain profitability
Closely tracking the impact of the higher Employer’s National Insurance costs and rising business rates

Cost control and efficiency also play a vital role. Businesses should conduct regular cost audits, empower teams to identify efficiency savings, and explore outsourcing non-core functions to reduce overheads.

Tax planning is another area that should not be overlooked. Businesses can benefit from government incentives such as R&D tax credits and capital allowances. Also ensure compliance with the latest fiscal changes to avoid penalties. Another area to explore is salary sacrifice schemes as an alternative to pay rises and bonuses, but to provide colleagues with alternative valued benefits.

Leveraging Finance, Investment, and Growth Opportunities

Taking a forward-thinking approach to finance and investment can help strengthen business resilience. Club members recommended:

Accessing Finance: Businesses should explore different financing options—loans, equity, grants—and build relationships with lenders and investors before funding is needed. Seeking expert advice and conducting thorough research is crucial.
Revenue Diversification: Reducing reliance on a single client or revenue stream enhances stability. Researching new markets, products, and services can create alternative income sources. In doing so, businesses should weigh the long-term benefits against potential risks. Recurring revenue models like annual servicing or other add-ons can also improve financial predictability.
Strategic Collaborations: Partnering with advisers, industry peers, or complementary businesses can unlock new markets, enhance service offerings, and drive innovation. Strong networks can provide valuable insights and growth opportunities.

Summary

Our March Business Club session provided invaluable insights into maintaining financial stability in challenging times. Key takeaways included the importance of structured financial planning, proactive cash flow management, and seeking out new opportunities for growth through finance and collaboration.

By focusing on resilience, adaptability, and long-term strategy, businesses can safeguard their future and continue to thrive.

Thank you to all our Club members who contributed to this discussion. If you’re interested in attending future Business Club events, please contact the Shipleys’ Godalming team for more information.

Specific advice should be obtained before taking action, or refraining from taking action, in relation to this summary.