As a business owner, there is always something to do, however many owners often spend more time working in the business than they do on managing the business. The end of the financial year is a good time to take a step back and have a look at how your business is performing. Here are ten simple management tips to help you be a more successful business owner, in good and not-so-good times.
- Watch trends in your industry. Compare your business performance with your competitors and to performance in previous years.
- Review your market and your sales/marketing plans at least every three months. There are plenty of free online resources available to teach you the basics and don’t be afraid to ask for outside help if you need it.
- Review your financial management. Timely, accurate reporting is vital to the success of any business. Work with your business adviser to develop Key Performance Indicators (KPIs) to ensure you stay on track.
- Ensure your budgets are current and regularly reviewed. If profit falls below what you had budgeted, prompt action is essential to reduce costs or boost sales.
- Align your business development plans with your budget. Ensure they are practical and won’t put any undue pressure on your profit margin. If you can’t afford to do or buy something now, postpone it to when you know your business will be in a better financial position.
- Ensure credit control is tight with prompt follow-up of overdue accounts. There are a number of apps that can automate this process to make it easier. Make sure that your clients are aware of your trading terms up front and if you have any concerns, discuss it first or refer them elsewhere. No clients are better than clients who can’t pay.
- Review your payments policy. Are you taking maximum advantage of prompt payment discounts? Or if you are unable to pay an account in full by the due date, talk to the supplier and make arrangements to pay it off. Keep the communication open and honest and fulfil your promises.
- Review credit facilities with your bank. Check with a finance broker to see if there are there better options available that could save you money.
- Check inventories and ensure your stock turnover rate is at least equal to industry standards.
- Above all DO IT NOW! If things look bad, take action to correct the situation. Look for positive approaches to solving any problems; and for new opportunities to build your business.
These all sound pretty simple, but in the day-to-day running of a business it’s easy to let the simple things slide. For your peace of mind and success, do these important things first to ensure you start the 2017 financial year on the right foot.