Preparing and Planning your New Financial Year
5 steps to preparing for the New Financial Year
Year-end is looming, we are rushing around to make our Annual Sales Goal, submit our tax returns. Did we exceed it? Did we make it? Let us reflect on the last 10 months of the current year and make a plan for the New Year.
Let us look at the Good and the Bad and how we can make it better, make it grow.
Reflect on the current year and compare it to the previous year, month vs month. Firstly, see what worked and what didn’t work, the best place to look is at your Income Statement and Balance Sheet. It has a story to tell.
Create a plan using the following factors – a mind map is a good tool to use.
- People – look at the people that were your clients/customers, your suppliers, and your employees – what worked, what didn’t. What do you need to change?
- Place – Is the place you are working in or at, working for your business, is it worth the cost. Is it bringing you enough revenue?
- Product – There is a lot of factors regarding a product. Are you producing enough? Are you selling enough of it? What other products/services can you create, is there a need /demand for your product? Are you marketing your product/service correctly or to the correct market? Is your product/service priced right, is your product/service packaged correctly?
- Price – Is the price right, is the cost price right, is it giving you enough profit to cover your expenses. Next, look at the price of your operating expenses – are they valuable, a need, or nice to have. Write it down in two columns – NEED / WANTS and why.
- Promotion – Are you using the correct social media, do you have a website. For Instance, do you need to do email marketing, or cold calling ( I do not like cold calling) what is the best medium to promote your product?
- PROFIT – This is my favourite – Are you making enough PROFIT, to put away 50% to tax/rainy day fund /owners salary savings account. Is your Profit in your bank account or only on paper?
Once you have a plan or even an initial plan Create a Budget – Compare last year and set goals/Intentions to improve and grow your business.
This will create lots of questions and maybe some overwhelm, tackle it in bite sizes.
At The Bookkeeping Company, I work with small businesses to create a doable budget using your current figures, contact me, to set up an appointment to help you, assist you with creating a budget.
Cash-flow -Let us talk about Money now, my favourite topic, every business needs a cash-flow, it is different to a budget, it helps you know what is coming in, what expenses to expect and when increases are due, when certain once a year expenses are coming due. Have a look now at some of my previous blog posts on managing your cash-flow Managing Cashflow — Part 1 and Managing Cash Flow – Part 2 I have also included a template on Cashflow Money Management.
Finally, Create a Savings plan – Split it into a Rainy Day fund(What some people now call COVID Fund), a savings fund for VAT payments, PAYE payments, Income Tax payments and Leave and Bonuses for employees.
In Conclusion, these are 5 of the ways to prepare for the New Financial Year. There are many more, I have a lot of knowledge, information, templates etc. Need assistance, moral support and someone to take the overwhelm away, email me, Cherine@thebookkeepingcompany.co.za to book a consultation.Call me Cherine 082 403 0792