Many industries are still experiencing difficult times. The retail sector faces challenges such as the battle for online sales, decreased consumer confidence and unemployment. Resources, mining and manufacturing are encountering challenges caused by exchange rates and the high cost of doing business in Australia.
To make the most of this optimism and ensure they have a clear path to growth business owners need to have strategies in place to end the year and start the new one in the best shape possible. This will also ensure that business owners can make the most of the holiday period.
Here are 14 things business owners should do before 2014:
1. Review the products and services you sell. Tailor the mix to appeal to changing customer needs for the holiday and new year season. Also, start considering and planning for other times in the year when customers’ needs change, for example Easter.
2. Review pricing structures to ensure competitiveness and profitability. Put formal procedures in place to monitor and proactively respond to competitor pricing changes.
3. Review stock levels. Make sure you can satisfy customer demand for profitable product and service lines. Identify slow moving stock that can be liquidated as “bargain buys” or bundled with other products as a value-add.
4. Review sales, marketing and promotion plans. Make sure plans are optimised to help achieve the best results not only during the holiday season but well into the new year. Ensure staff are aware of the targets for each week and be proactive in monitoring and addressing shortfalls.
5. Review staffing plans and confirm acceptance of the rosters by all staff. For non-retail businesses, annual leave plans need to be balanced and finalised as early as possible to ensure the business continues to operate effectively. Consider a shutdown period if the Christmas and New Year period is traditionally not busy to use up staff annual leave balances during this quieter time.
6. Review fraud and theft protection systems. Ensure all staff are reminded of their responsibility to be vigilant as customer traffic increases and the pressures of Christmas expectations can motivate increased customer and staff theft.
7. Review debtor lists and actively chase all overdue accounts. Any amount not collected by December 23 is unlikely to be collected until February or later. Collecting money owed to you is critical particularly over this period when the cash cycle tends to tighten.
8. Review the use of finance products for effectiveness. Overdrafts, premium funding, lease facilities and cash flow funding products can all be excellent tools to help match a business’ cash supply with planned outlays, and may be especially useful in managing cash flow throughout the holiday season.
9. Complete a GST health check. Small businesses are in danger of losing time and money because of unreliable or outdated business systems causing them to incorrectly report GST.
10.Set effective goals. The beginning of the new year is an ideal time to review goals set at the beginning of the financial year, ensure you are on track to achieve them and put in place an action if you can see areas that are not working. Important things to consider include retirement planning, present and future investments, maximising your superannuation scheme and reviewing assets.
11. Update your business plan. Make sure your business plan is updated regularly to reflect changing market and economic conditions. Keep in mind a solid business plan is critical in meeting financing requirements as many industries face increased scrutiny from government and financial institutions requiring a much higher quality of management reporting and strategic planning to support funding applications and reviews.
12. Strategically plan end of year gifts and entertainment to key customers, prospects, suppliers and business partners. This will strengthen relationships into the new year rather than simply being a cost of doing business.
13.Carefully plan end of year staff parties to reward and recognise efforts for the year. Remember your workplace obligations to provide a safe environment for the event in relation to alcohol and discrimination.
14.Remember that you deserve a break as well. Plan to take advantage of any public holidays or other time off to protect your own health and wellbeing and reduce the chance of illness disrupting your business activities.
RSM Bird Cameron | Ph: (02) 6217 0350
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