The start of the year is a great time to reflect on the successes of the year that was and picture the achievements you could reach in the year ahead. Astute business operators harness the perspective that comes with a new year to define and refine their New Year’s resolutions and business goals. With this in mind, here are 8 tips to kick start your year to reach your full potential in 2022.
1. Review your business and marketing plans
Now is a good time to take a breath and think about your long-term vision and marketing. Is your business on track? Has it expanded beyond your original plan? Has your ideal client changed?
Taking the time to update your business and marketing plans will influence every decision you make in the next year. Doing so might even give you new ideas for products or services or identify any gaps in your business.
2. Determine your hiring plans
Consider whether your current staff levels and skills mix will enable you to deliver into your business plan. You could go even further. Do your staff reflect and embrace the culture that you have or want within the business? Employees are the lifeblood (besides cash flow) of the business so think carefully about whether you have the right team on board who are engaged and skilled to support you to deliver into the business plan.
In addition, while reviewing your staff files ensure your staff contracts are up to date. Awards change so it’s a good time to review these.
3. Cash flow lifeline
Cash flow can become overwhelming when you’re not actively managing it, especially when the business is growing, because that growth needs to be funded. Use the beginning of the year to identify the timing of when the additional cashflow needs are going to hit by preparing a cashflow forecast that reflects your business plan. Map out a plan of what funding sources you can utilise to get you through these painful growth spurts (these can include prompt collection of debtors, extended creditor terms, overdrafts and owner’s equity).
Start developing a picture of what the cashflows of a successful year will look like now then plan to ensure you have funding sources to identified to see you through. If your bank or broker is not on the same page when it comes your cash flow picture consider if they are the right fit for your business. Your accountant is a valuable resource when it comes identifying the right fit for your business.
4. Start planning the next seasonal campaign
The first few months of the year are a good time to think about the calendar of activities you can do to ramp up the pipeline of new work and to schedule the next period of down time. This helps in managing the timing of key staff taking leave so they are on deck when you need them and taking a break in the quiet times. Consider what your clients schedules look like and when is the best time to engage with them to reinforce repeat purchases.
5. Get a handle on your financial health
For most businesses with a 30 June year end, you are just over half way through the financial year and have 6 months to hit your budget for the year ending June 2022. Use this half way point to check if you are on track to meet budget, assess how the year to date result has varied from your original budget and what you can do to impact the end of year results. Sit down with your accountant to forecast out the year end result if you remain on the current trajectory, even better simulate a few key changes to revenue, margin increases, debtor collections and expense reductions to see what is possible to give you renewed focus to hit the result.
6. Your role in the business
Too many business owners say they end up spending too much time in their business, rather than working on larger plans and direction. Now is a good time to consider how that relationship is working in your own enterprise. Do you have enough time to set and monitor execution of strategy?
If not, carve out some regular time in your schedule to make that happen on a regular basis, perhaps fortnightly or monthly. A good way to ensure this happens is to be accountable to someone, if not a business partner then consider regular catch ups with your Accountant who can help keep you on track to progressing items that are part of the bigger picture. The long-term prosperity of your business relies on your leadership and strategic direction.
7. Have your system work for you
Too much of your work is manual and most of the time there is a more efficient way of doing things.
Start by looking at the tasks that take you the most amount of time, then figure out how to automate them. The less you have to do, the better and never underestimate the power of data!
If you are running cloud based accounting software there are thousands of add ons that can unlock efficiencies for example, a popular add on allows you to take a photo or upload your receipts from your phone and it will code the expense to your system accordingly, removing the need for data entry.
If you’re not yet utilising cloud based accounting software efficiently now is the perfect time to give this some consideration and implement updated prior to 1 July. There are many products on the market so talk to your accountant about which one is right for your business.
8. Plan a strategy getaway for your top leaders
One of the most important weapons on a business owner’s arsenal is strategy and vision. Take some regular time in order to decide what the next steps for your business can be.
Remember you can’t always do that on your own. You need to get your top team involved. Instead of depending only on yourself, book in some time with your team away from the day to day to think about what you could really accomplish in 2022.
Think big. Think ahead of the next 12 months, and then use the next year as a way to get closer to your long-term goals. Without that vision, you’ll be lost. Take some time out with your team and gain some clarity.
If you would like to discuss forecasting for the year ahead, accounting software to help improve efficiencies or require assistance reviewing, planning and setting your business goals and objectives in 2022 speak to your usual Mazars adviser or one of our specialists via the form below.
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