Whether your business is a start-up or a veteran, here are 4 ways to get your business off to a flyer this Autumn…increasing profitability, saving you time and reducing your costs.
Metric’s 4 key steps:
(1) Make a business plan
It cannot be stressed enough how important it is to prepare a business plan. In the same way that you wouldn’t set out on a journey without a clear idea of which route you intend to take, you should not try to run a business without a clear idea of what you want to achieve, and how you expect to get there.
A business plan should be as detailed as possible, to ensure that all potential obstacles are identified. To do this properly, you will need to include a financial budget into your plan. Generally speaking, it is when you start to look at the numbers that you start to be more realistic about what you can (and cannot) achieve in the next three, four or five years.
(2) Management accounts
Based on our experience, many business owners do not have an up-to-date picture of how their business is performing. Management accounts can fill the gap between annual accounts, providing a guide as to how profitable your business actually is and well as useful insights into debt collection and cash flow, for instance.
To make it even more beneficial, compare your management accounts against your budget. If you are not performing as well as expected, look at the reasons why and make the necessary changes. Finally, management accounts are a great way to estimate your current year’s tax bill. Providing your business would perform similarly over the remainder of the year, you should have a good indication as to how much corporation tax you will need to pay further down the line.
(3) Put good systems in place
Setting up internal procedures early on not only improves customer service, it can also save you money. If you have slick systems, it improves efficiency and reduces the need to correct mistakes, which all helps to improve your bottom line.
For example, take invoicing. How are you going to invoice your clients and ensure that you invoice your clients on a timely basis? How will you make sure you know which invoices have been paid? Whilst this is not as exciting as say, marketing, it can have a dramatic effect on how your business is perceived by customers.
(4) Use the right business structure
Many people are not aware of the legal and tax differences between operating as a traditional partnership, a LLP or a limited company. These differences can have a huge impact the business’ tax position, as well as determining your personal responsibilities.
Establishing a limited company can be a great way to reduce your tax bill and limit your personal liability (should the business fail). However, you should not form a limited company just because you think it might be a good idea. For instance, you should be aware that being a director carries certain legal responsibilities. We would always suggest speaking to an accountant to ensure that you make the right choice for your situation.
Conclusion: Kick-starting a business is very straight forward. You simply stand back, ask the right questions, decide what steps need to be taken and then implement!
Tough Question: Which step will you implement today to kick start your business?
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Tell us what you think: Do you agree with us? What has worked for your business? Please let us know.