As we head into the new financial year, now is the perfect time to plan and take stock of the position that your small business is in. Having just prepared your tax return, worked out deductions, and organised your records, you’ll have a clear idea of where your business stands and what you need in order to have another or more successful year. Failure to plan properly is, after all, one of the major pitfalls that so many business owners fall into. Below, we have outlined some of the best ways to prepare your business for the financial year ahead.
Learn From The Previous Year
Have a look at your financial statements from the last year and try to spot any trends or patterns. Examine the areas where you were spending the most money and evaluate whether you could possibly reduce any or all of these spendings.
You should also be looking at where you paid fees, interest, and any consistent outgoing payments or subscriptions. Perhaps you can negotiate a lower rate from your suppliers or make the decision to buy items in bulk for a much lower cost. If you often give your employees cash bonuses as an incentive or during holiday periods like Christmas, you could instead consider offering flexible working arrangements or other incentives that won’t necessarily cost your business money.
Manage Your Cash Flow
At the beginning of the year, you should prepare an annual cash flow projection as well as quarterly and monthly projections. These cash flow projections should include your expenses, profit, overheads and debt collections. Having projections at frequent periods throughout the year will help to ensure you are consistently evaluating and reevaluating finances as well as verifying that you always have a healthy cash flow to cover everyday expenses.
Update Your Technology
This is a great time to update your technology, particularly when it comes to online or cloud-based accounting or HR programs. If you’ve found that your bookkeeping skills haven’t quite been up to scratch during the previous financial year, this is the best way to keep your records and finances in one, easy-to-access place. What’s more, when it comes to sorting out your EOFY tasks next year, you can simply give your accountant access to everything they need.
Make Sure You’re Protected
Make sure that your business is fully protected heading into the new financial year. When running a small business you’re likely exposed to more risks than you would think. Consider how your business has grown or changed in the last year and whether or not you still have the best insurance for your industry and business needs. Each company tends to vary in terms of the kinds of business insurance they need so it’s important to get advice from an expert who can clearly lay all of your options out for you.
At Allsafe Insurance Brokers, we don’t believe in ‘one size fits all’ insurance policies. Each business and business owner has different requirements, risks, and budgets which is why we take the time to chat with each of our clients to understand their needs. To find out more about how we can help your small business, get in touch with us today!