When Your Business Is in Financial Crisis—What to Do First. Business financial crisis consulting.
- 5SCFO
- Apr 21
- 3 min read
Updated: Apr 23
No one starts a business expecting a financial crisis. But whether it’s a sudden drop in revenue, unexpected expenses, or a breakdown in leadership, it happens—more often than most business owners care to admit.
When you find yourself in the thick of it, the instinct is to react quickly—sometimes emotionally. But in a financial crisis, your first moves matter more than you think. The decisions you make today could determine whether your business stabilizes… or spirals further.
This guide is here to help you take those first steps the right way.
1. Don’t Go Into Hiding—Face the Numbers
One of the most common reactions in a crisis is avoidance. It’s understandable. Looking at your financials when things are bad can feel like opening a wound. But clarity is your lifeline right now.
Start by gathering:
A current profit & loss statement (even if it's a mess)
Your latest bank statements
An aging of payables and receivables
Any debt schedules or loan agreements
Don’t worry if things are disorganized. What matters is getting visibility—so you can start making decisions based on facts, not fear.
2. Identify the Immediate Cash Situation
You can’t fix what you can’t fund.
Ask yourself:
How many days of cash do you have?
What’s coming in—and when?
What can be deferred, paused, or renegotiated?
This is the time to prioritize cash flow triage, not just profitability. A business can survive temporary losses—but not a complete cash shortfall. Build a 4-week rolling forecast, even if it’s basic. It’s not about precision—it’s about control.
3. Talk to the Right People—But Not Everyone
In a crisis, communication is key—but so is discretion. This is not the time to overshare with staff, clients, or vendors. But you do need to pull in the people who can help solve the problem.
Who you should loop in:
Your internal bookkeeper or accountant
A trusted financial advisor (ideally one with crisis experience)
Any business partners who have decision-making authority
Avoid the temptation to vent to friends or vendors. This is a time for quiet, strategic action—not panic-driven talk.
4. Stabilize the Business, Then Strategize
Before you start thinking about “fixing everything,” focus on stabilizing the business.
This might include:
Cutting non-essential spending
Pausing big projects or hires
Re-negotiating payment terms with vendors
Accelerating collections on receivables
Only after cash flow is stable should you start exploring longer-term solutions like restructuring, new financing, or strategic pivots.
5. Don’t Try to DIY Everything
If you’re feeling overwhelmed, there’s a good reason: most business owners didn’t go into business to run turnaround operations. You’re likely dealing with emotions, stress, and operational fires all at once.
This is when you need someone who’s been through this before—someone who can look at your numbers and see a path forward.
That’s what we do.
This Is Where 5S CFO Comes In
We specialize in business financial crisis consulting. We’ve helped business owners navigate everything from cash crunches to partner disputes. We bring calm, clarity, and structure when things feel out of control.
If you’re not sure what to do next, let’s talk.
There’s no pressure. No judgment. Just straight answers.
Final Thought
No one wants to be in a financial crisis—but if you’re in one, you’re not alone. What matters now is how you respond.
Don’t freeze. Don’t guess. Don’t go it alone.
Start with clarity. Then take it one step at a time.
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