How can you prepare your business for the new financial year?

You just got over the EOFY stress, so it’s time to focus on your new financial year. “Oh, no… I wanted to go on a vacation and forget about my finances…until next EOFY.” I wish you could do that.

Instead, I firmly believe it’s the best time to plan ahead, prioritise your business goals and begin the new financial year with a fresh outlook.

Here are some tips for you to get you better prepared for the new financial year.

1) Review your systems

Are your business systems still serving your business? Are there more effective or better solutions? Are you doing your stuff a certain way just because they’ve always been done that way? Can you automate some of your processes? Could you integrate or connect two pieces of software you use?

Take your time, sit down and be honest: could you do it better? If your answer is YES, then it’s high time you get your act together and DO IT. Effective and automated processes will boost your productivity significantly.

2) Forecast and plan ahead

New financial year = new opportunities

It’s pivotal for each and every business to have a forward-looking budget. To be successful financially, you need to know where you’re heading to. I hear too many times: “But I am a small business; I don’t need a budget. I need to work hard, and it’ll be all good.” Let me tell you: it’s a great mistake. It doesn’t matter how small you are, you need to have a forecast, and you need to be aware of the financial impacts of your business decisions.

So take a sheet of paper or open a spreadsheet or voice-record yourself or whatever your preference is and forecast realistically your revenues and expenses and, most importantly, your cash flow.

If you need any help in this process, we’re here to help you.

3) Review your prices and payment terms

Though this topic is an integral part of budgeting, it’s worth dedicating a separate chapter to it.

At the start of the new financial year, it’s an excellent opportunity to adjust your pricing structure. Do you charge what you are worth? Did the increase in your direct costs (eg. materials) eat up your gross margin? I hear you: you’re afraid that your customers will turn away if you put your prices up. My response always will be: it’s your business, but at the end of the day, your ultimate goal should always be to have a profitable business. If you’re not making enough money, you should review your financials and focus on the ways how to turn your business profitable.

If your profitability is good, but from time to time, you have cash flow problems, your focus should fall on your payment terms: do your customers pay on time? Can you offer any incentives to do so? How do you pay your suppliers? Are you in the position to change your payment terms, for instance, from 14 days to 30 days?
Efficiently managing your incoming and outgoing payments could contribute to a better cash flow position. And we all know: cash is king in business.

4) Time is money

Your most precious resource is your time. Did you spend it wisely?

Look back to your year and list what you spent your working time on. Then assess each line: was it necessary for growing my business? Was I the best person to perform that task?
Now, write another list: what are your priorities for this year in terms of your time? When ready, please review your lists and be prepared to delegate or outsource tasks so that you can focus on growing your business, nurturing the leads and achieving your business goals.

5) Invest in your skills

As a business owner, you should always strive to keep up-to-date with the trends in your industry. New methods, new processes, new technology – you should be on top of them and consider whether it’s worth implementing them in your business?
Did you glimpse a strategic opportunity? Prepare for it by upskilling. Do you want to improve your leadership? Do you want to explore your potential? Look for an inspiring business coach.
You need to remember that professional development is always rewarding, and the knowledge cannot be taken away from you.

+1) Be organised

Not many business owners excel in accurate record-keeping. It’s a tiresome activity if done once a year. Do you remember what you bought for $56.7 in Bunnings 9 months ago, let alone find the receipt?
You need to get into the habit of capturing & storing all your business records at the time of the transaction. It’s literally not more than 20 seconds, and it’s all done, you can forget about it. There are efficient apps for this purpose. Please explore them.

Takeaways

A new financial year offers you a fresh start to achieve your business goals. We shared with you some tips on how you can be better prepared to grow your business.  

The substance is planning and reviewing, and continuously repeating these two actions. Review your systems, upgrade or renew them and review how they perform. Forecast your financials and regularly review them and update them as necessary. 

I’d love to hear from you,

Krisztina
Organised BAS

PS:
If there’s any topic you find worth discussing, or you have a question, please don’t hesitate to contact me on any of my channels or drop me a line on the form below. I’ll shortly come back to you with my reply.
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