Most business owners focus so much on finalizing tax returns and everything else that goes along with financial year end preparations - they tend to lose sight of the importance to set strategic goals and plan for the challenges of the new fiscal year.
The checklist
If you plan in advance by putting effective systems in place after evaluating all aspects of your business, you will be able to take on the new year with confidence and be fully prepared. The unforeseen pandemic and economic implications thereof over the past six months have now more than ever before highlighted the importance for any small business to be financially healthy at all times in order to not only survive but thrive during challenging times.
Here is a helpful checklist for small business owners to make sure they are prepared to confidently take on the new financial year:
- Take stock by re-looking your inventory to see what sold and what sat on the shelf over the last twelve months. Evaluate existing product trends and consider taking non-sellers off your books while adding new product lines that might bring in a better return. If you are in the service industry, align your offering with current demands and eliminate those which are too time intensive.
- It is now the time to re-evaluate your operational costs by making a list of what you require to manage your business more cost-effectively. Consider sub-letting a section of your office or warehouse space if possible, discard outdated equipment that is no longer needed and use any possible profits to purchase what you need to be more efficient. You might need to cut staff, service providers or vendors who aren’t adding value or are not essential any longer and also consider eliminating unnecessary waste in your business by for instance reducing your carbon footprint.
- Make sure you have a clear picture of the true costs of running your business by putting systems in place to track your expenses, income and even your time spent working in the business. Continue to monitor these and ensure to make the necessary changes when things don’t balance. In other words, you need to know when your business is no longer profitable and make sure you have the means to fix it.
- Focus on identifying good customers by keeping record and tracking their purchase history. Take the time to identify and Implement new customer services which will simultaneously optimize their experience and interaction with your product or service. Don’t try and service more customers daily, rather focus on those who return and are loyal, they will recommend you which will lead to more trusty customers down the road.
- Review the time and costs spent on certain aspect of your business, for instance software or technology. Weigh up the time and cost saving should you replace for instance your accounting system to streamline your financials, a better payment processing system or a time management tool to monitor your team’s efficiency and progress. This might be able to help you increase your profitability in the long run.
- Do some research in the industry to find out what your competitors are offering and identify a product or service that will differentiate you from the rest. If you are the only one offering it, you can also determine the industry price. Try and find additional revenue streams through new and unique product offerings instead of increasing your prices for existing services or products. This way you might be able to keep your prices lower than your competitors while simultaneously increasing your income by being proactive and innovative.
- Invest in your yourself by upskilling. If you were never confident to for instance handle your own marketing initiatives, then perhaps do a short course on digital marketing or selling online. Consider investing in a mentor or business coach who can guide you through all aspects of managing your business including identifying and managing the right marketing channels for your line of product or service.
- Take the time to meet regularly with your team. Ensure they understand your goals for the new year and the means you’ve put in place to reach them. Give them the tools and support to help you reach those goals faster and always ensure that they feel part of a valued team.
- Probably the most important thing when it comes to managing your business is to make sure that you stop wasting time and energy on low value activities that will not yield any results or profits. Identify those areas you are wasting precious time on and delegate or eliminate them. Make this new financial year, the one when you prioritize your time and energy to work on your business, not in it.
The next steps
Running a business is not easy and many small business owners will face similar challenges. If this is the year you want to do things differently and make your business more resilient, then consider reaching out to a reputable and certified business coach who will be able to help you overcome any obstacles and set your business up to thrive! Click here to find a local business coach near you!