SME planning tips to kick-start the new financial year

With the stresses and strains of the end of financial year passed, July is a great time for business owners to reflect on the year gone and reset and refocus for the year ahead.

Here we provide 5 SME planning tips to gear up for the new financial year.

1. Goals and objectives – review and rest

Business planning and accountability to the plan are they key to business success and decision making, and the start of the financial year is a key time to sit down and re-visit your short-term goals and longer-term business strategy.

This includes;

• Reflect: Look back on your goals and objectives you set last year and review how you tracked against this – both financially and operationally.
• Review: Are there any changes or improvements that need to be made to your business strategy going forward? Are the current products and services meeting your customer’s needs?
• Reset: Reset your goals and objectives for next 12 months as well as your longer-term strategy – and set up a plan to be accountable to and monitor this throughout the year
• De-clutter: Use the start of the new financial year as an opportunity to de-clutter, catch up on administration, and prepare your business and work space for the fresh start. Eliminate everything that no longer has a practical purpose. If your office has started to pile up with paperwork, sort out your filing system and ensure that you only file essential information such as purchase and sales invoices, bank statements and important customer data.

By investing in some planning, you can ensure your decision making, operations and structures are all aligned and consistent with your vision and plan.

2. Take control of your business cashflow

Re-visit your cash flow plan including;

• Cashflow: Sustain a healthy business cashflow in the new financial year, ensure invoices are raised in a timely and efficient manner, issue statements and reminder letters.
• Terms of trade: Ensure all terms of trade are clearly communicated, and review terms with your suppliers.
• Future Funding: Spend some time to revise your funding requirements based on your business planning. This includes ensuring your current financing arrangements are suitable, and that any other asset, day-to-day operational funding and future growth and expansion funding requirements are being planned for.

3. Get your return in early

There can be benefit in putting aside time to get your tax return underway as soon as it is practical, so that you can get a more accurate picture of your cash flow heading into the financial year. This will help you to concentrate on growing your business.

4. Stock matters

Review your stock levels carefully. You don’t want to get your business into an over-stocked position where all your money is tied up in goods that you may not necessarily be able to sell. Now could be an opportunity to offer sales and discounts on your products and services to your customers. Look back at last financial year’s sales figures to determine upcoming seasonal peaks and troughs.

5. Pay attention to your staff

It’s important to spend some time with your staff and it can be a good time to conduct an annual review, to ensure your business plans and objectives are communicated too the team and their annual plan aligned with the business plans. Consider external training courses to boost the skills of your existing staff. Your staff will be happier and more productive too!

Additionally, review your staffing levels in line with your goals and needs and plan out the year to cover staff holidays and the peak season demand. Do workloads need to be juggled?  Are there any significant skills gaps within your workforce that is holding your business back?

Anthony Landahl | Equilibria Finance

This is for general information purposes only and does not constitute advice. With all of these options there are a number of considerations outside the scope of what is covered in this article that you need to understand to ensure your personal circumstances are taken into consideration.