We’re into the last quarter of our season in business, coming to the end of Financial Year.
This is where we measure our results, work out how much tax we must pay, and draw breath ready for the new season.
There’s a few things which as business owners we need to do to set us up for maximum success in 2017-18 Financial Year.
- Review your current results
It’s a great time to take stock of what’s worked and what could have gone better for the past year.
What marketing activities won you more business?
What customer relationships opened opportunities for you?
What client groups really got you and your business?
Where did most of your profit come from?
These are all important to consider so you can start developing your marketing strategy for next season.
They say that 50% of all marketing budgets are wasted, if only we knew which 50%.
Well wasting money is what we need to avoid, and reviewing year to date (YTD) results should save you from making the same mistakes twice.
- Speak with your accountant
Now is the perfect time to meet with your accountant to understand your tax obligations, and work out if there are any ways you can legally reduce or defer your tax liabilities.
This could be as simple as pre-paying some invoices for next financial year, or writing off bad-debts which are unlikely to be economic to pursue.
It might be about topping up you or your partner’s superannuation, or taking advantage of the $20k rapid depreciation schedule which is in place until the end of June.
The thing is, if you have these conversations with your accountant NOW, rather than after the financial year has ended, you can act to get a better result.
It’s no good finding out what you could have done after the event.
- Set your new budget
I know, there’s nothing sexy about a budget.
However, how can you know how you’re tracking if you don’t have any targets to aim for?
Good business is all about the details, and having a budget based on good data can help you out-perform the competition.
Because the devil’s in the details!
Those little one-percenters which many people don’t track can be the critical difference between success and going broke.
When you understand your numbers, and you know how to control your profit levers, your business will bloom.
For example, if you can squeeze another five percent out of your Gross Profit (GP) margin, which doesn’t seem like a lot, this can add a tidy sum of money to your bottom line.
If your revenues are around $100k per month, this would be $60k Net Profit (NP) per annum.
Now if you’re not monitoring your direct cost of sales very carefully, this is a difficult thing to achieve.
And the best way to do it is by loading your budget onto your financial management system.
Remember the old saying – “If you can measure it, you can manage it!”
So, start thinking about setting yourself up for a great season, and organise to meet with your advisor to develop a plan.
Then all you need to do is aim, fire, adjust and repeat!