Business owners are certainly facing challenging times as they navigate a global pandemic while trying to ensure their business remains financially stable. So, how are we guiding our business-owner clients during this time? 

Document and record the state of business

We are encouraging our business-owner clients to document and record the state of their business during these times by saving and archiving financial statements, cash flow projections, and significant HR decisions. This record-keeping serves a few purposes. First, it can be used to substantiate your claim of being negatively affected by the global pandemic and deserving of government assistance should your company benefit from any of the offered programs. And, if you did not receive any government assistance, it is an opportune time to look internally at your business, how it has performed during this stress test, and how you plan to innovate and pivot to respond to the customers’ changing demands. 

Examine overall financial health and well-being

Another way we are guiding our business-owner clients through is by analyzing how this disruption has affected their overall personal financial health and well-being. Not only has your business likely been disrupted, but your portfolio has also probably gone through a stress test of its own. It is essential to build a personal financial plan that includes not only your portfolio assets but also the different business results and cash flows. We have been helping our clients model out different scenarios and how they can affect a potential exit from the business should it become necessary. 

Consider what you did to prepare

Our discussions with our clients during these tumultuous times center less on “what should I do now?” and more about “this is what we did to prepare.” As all business owners know, cash is king. This adage rings true when you are building your portfolio for the long-term as well. Building up a 12-24 month cash or short-term fixed income reserve is a prudent thing when facing very uncertain and likely volatile conditions.  Cash flow management is one of the most considerable challenges for business owners both inside their business and in their personal portfolios. Having a team of advisors who can help guide you through tough decisions is imperative to success during these times.

Look on the bright side

On the positive side, there are plenty of opportunities to take advantage of different market conditions – including right now. For those who need to borrow, interest rates remain historically low. This situation also makes many wealth transfer techniques especially attractive right now. If you are planning to transition your business to the next generation, there are planning methods to consider that take advantage of low interest rates, a low income-tax environment, and possibly lower business valuations for family transfers.

Overall, this is certainly a unique time to own a business.  There are indeed many more things to consider today than there were even three months ago. We are focused on helping our business owners understand the opportunities, navigate changing customer demands, and make sure that their family legacies are preserved and poised to grow.

As always, your Bartlett advisor is here to help you create a solid strategy to protect and grow your business. What’s more, our family office wealth management services are designed to cohesively coordinate your business and family’s affairs into a unified vision for wealth and well-being.