As one financial year comes to a close and a new one begins, it can feel like a fresh start for your business. In the months leading up to 30 June, it’s easy to become so focused on sorting out your tax affairs that you lose track of where your business is heading.
But once the end of financial year (EOFY) rush is out of the way, you can actually recalibrate – and think about the year ahead. Here are five ways you could ensure your business starts FY20 on the right foot.
1. Take stock of the last financial year
The beginning of a financial year is a great opportunity to take a step back and consider the bigger picture for your business. It helps to look closely at how your business performed in the past 12 months against the goals you set for FY19. By identifying your business’ strengths and challenges, you’ll know where you need to concentrate your time, energy and resources for the coming year.
2. Update your business plan
As you enter a new financial year, it’s a good idea to review your business and marketing plans. You can start by setting your goals for the next 12 months: what do you want to achieve with your business and how will you make that happen? Having clear goals will help you shape a strategy that you can break down into actionable steps for each quarter.
When updating your business plan you should consider a wide range of factors, including your clients, services and the industry landscape. For example:
- Who is your target market, and has this changed?
- Do you have any new competitors?
- Is your pricing structure still appropriate?
- Do you need to upgrade your insurance cover?
- How would you like to grow the business?
- Should you try some new approaches to marketing and promoting your services?
3. Prepare your finances
Once you have an updated business and marketing plan in place, you should draw up your budget for the year. If you look back at the previous year, you may notice times when you received a lot of income – and other periods when you didn’t.
If you’re registered for Netbank or CommBiz, you may be eligible to use Daily IQ to help you analyse your operations and expenses. This free tool allows you to track your cash flow in real time and view your business performance over the past financial year – so you can effectively forecast your income and expenses for the next 12 months.
By planning the timing of your expenses, you can ensure sufficient cash flow – and avoid letting invoices pile up. This will also enable you to set money aside during busy periods to provide a financial buffer for your business when things get quieter.
4. Sort out your records
Now that tax time is done and dusted, it’s time to get yourself organised. You know how much more smoothly things run when your bookkeeping is in order, so there is no better time to sort out your paperwork – and put a system in place to keep it that way all year round. This will not only make it easier to meet your tax obligations in FY20, it will also give you a much better overview of how your business is performing.
While you’re going through your records for the past 12 months, you might want to clear out the ones that you no longer need – so you don’t end up with a whole lot of clutter from last year. By archiving your old physical and digital files, you can start the new year with a clean desk and a clear mind.
If you’re not using cloud storage, then you may be missing out on the benefits of a centralised secure database for all your client and business information. There are plenty of cloud packages available, which you can tailor to the needs of your business.
5. Reward your staff
As a small business owner, you know that your greatest asset is your people. Hiring and training a new employee can take time and resources – impacting on your business, service and even your clients. To attract and retain the right staff, it’s vital to provide a supportive and nurturing environment where they can thrive.
When people are working hard, they want to feel that their efforts are appreciated. Now is the perfect time to recognise and reward your employees for their work over the past financial year – perhaps with a team lunch or a small gift. If your finances are tight, you can find creative and inexpensive ways to acknowledge the contributions of different team members. For example, staff awards or even a hand-written card can be a great way to let your employees know how much you value them.
Get the right support
Need help starting, running and growing your small business? CommBank offers comprehensive online tools and resources to support you at every stage of your business journey – visit commbank.com.au/smallbusiness