Smart Ways to Raise Financing for Your Business

Consider these simple steps to manage your firm’s finances in the event of a loss.
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3 mins
13 November 2025

Loss is a part of every business cycle, and as much as you may want to avoid it, it is better to have a plan of action to get your business through it unscathed. When your coffers are emptying faster than they are filling, inaction can only mean one thing—closure. So, rather than wait for this phase-out, take steps, and prepare the finances needed to remedy the situation.

Here are some simple steps to take when your business is running at a loss.

Stabilize Revenue: Sell More to Key Customers

To stabilize immediate cash flow, prioritize revenue generation. Start by performing a Pareto analysis to identify the top 20% of your customers who generate the majority of your profits.

  • Deepen Relationships: Focus all sales and marketing efforts on retaining and increasing sales from these most profitable clients.
  • Strategic Expansion: Simultaneously develop a focused strategy to acquire new customers. This involves critically assessing your offerings: Do you need to diversify into an untapped vertical? Can you improve your product/service to make it more appealing to a broader market? Launching a new, high-margin product could be the vital step needed to attract a new revenue stream and offset existing losses.
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Maximize Efficiency: Aggressive Cost-Cutting Measures

An aggressive cost-cutting program is the most immediate way to minimize losses and drive a turnaround. The goal is to make the business leaner and more efficient.

  • Operational Streamlining: Invest in technology to automate and streamline inefficient processes, reducing manual errors and operational costs.
  • Inventory & Asset Management: Implement just-in-time (JIT) inventory to prevent capital being tied up in surplus stock. Sell off non-essential assets that incur maintenance or depreciation costs but offer minimal utility. Clear out old stock through targeted sales programs.
  • Staffing Review: While difficult, review staff costs and consider measures like optimizing contract roles or prioritizing the retention of only the most productive and critical employees.

Smart Ways to Raise Financing for Your Business

When facing losses, securing a financial lifeline is crucial. This is where Smart Ways to Raise Financing for Your Business come into play. While it may seem counter-intuitive, strategic investment is necessary to fund the turnaround.

  • Internal Cash Boost: Quickly sell off ready-to-move stock (even at a discount) or transition to online sales channels to generate immediate cash. This internal effort bolsters your treasury and acts as a financial buffer.
  • External Funding Solutions: To cover critical working capital needs (like timely staff payroll and essential overheads) and finance your turnaround strategy, explore customized business loans for SMEs.
    • Unsecured Business Loans: Unsecured business loans provide fast access to capital without collateral, ideal for covering immediate working capital gaps.
    • Invoice Discounting/Factoring: Convert outstanding invoices into instant cash flow, which is crucial when customer payments are slow.
    • Asset-Backed Loans: Use existing unencumbered machinery or property as collateral to secure larger funds for technology upgrades or expansion efforts.

Leverage Tax Benefits: Claiming Business Losses

Don't overlook the opportunity to claim losses to save tax. For sole traders and partnerships, losses reported in your company's IT return file can often be carried forward to the following year. This strategic move effectively lowers your future taxable income, which in turn can significantly slash your tax liabilities, providing crucial financial relief as you execute your recovery plan.

By combining aggressive cost-cutting and sales strategies with smart ways to raise financing for your business, you can successfully navigate the loss phase and position your enterprise for future growth.

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