5 things every small business owner should do before 30 June
1/ Tax planning.
Ideally this should be done with your accountant / adviser around April / May, to ensure you get the maximum benefit from the process… but you can still make a significant difference to your tax bill by simply being smarter with some key activities. This is also the perfect opportunity to ask if you’re eligible for any concessions or rebates such as the $20,000 small business tax write-off which was recently expanded in the 2016 Federal Budget. If they don’t know… find an adviser who does.
2/ Check your year-to-date numbers.
One of the many benefits of online accounting software is that you no longer have to wait for your accountant to tell you how you’re performing (many weeks after the horse has bolted) – you can monitor your key metrics anywhere, any time, on any device. So you have a dynamic, real-time understanding of where you’re at.
Review your numbers now (I encourage you to do this with your accountant or business adviser) so you can determine whether you need to take action to correct (or compound) performance for the remainder of the year to achieve your targets.
Effective budgeting isn’t set-and-forget; it’s an ongoing process. If your budget runs along a financial year (which I recommend), you should be reviewing your performance to date, and start thinking about next year. Ideally you should create next financial year’s budget in the weeks after the start of the new financial year, so the better you can understand this year’s performance, and why you deviated, the better-placed you’ll be for creating a more powerful budget for next year. And as always, make sure you use bottom-up budgeting.
4/ Check your KPIs.
It’s a good time to revisit your performance in the key drivers of your business. Remember, your financials are only an indicator of performance; the true drivers of performance are the areas your KPIs relate to, which will be different for every business. However one that we all undoubtedly share is cash... if you have enough cash in the bank, you have the breathing space to meet your obligations and account for unforeseen issues (or capitalise on opportunities).
5/ Sharpen the saw.
We’re all incredibly busy. It’s too easy to be swamped by stuff. You need to make time to sharpen the saw, as Stephen Covey puts it – to step back and look at how your business can operate more effectively with less time and effort.
I urge you to take it a step further and hold an offsite strategy session. Getting away from your business helps you to step back and analyse it objectively without the daily noise clouding your judgement or limiting your thinking. Lock in the same time each year so it doesn’t get sidetracked by ‘stuff’. Consider using a facilitator to keep you on track and help you fully explore all opportunities and threats (I’ve helped several clients maximise their strategic planning process and achieve powerful outcomes as a result).
The offsite strategic planning session that my partners and I hold (at the same time) every year has been a key catalyst in our continued growth, and our ability to stay ahead of the game.
Speak to your accountant or adviser to work out in advance what you need to prepare in order to make your year-end activities as efficient and effective as possible (and so you get any eligible refund sooner). The sooner you get started, the smoother the process will be, and the less you’ll be dragged away from the important stuff.