Have you set any personal New Year’s Resolutions? Perhaps you have pledged to lose weight, quit smoking and spend more quality time with family & friends. But what about your business?
Spending less and saving more, as well as paying down debt, are consistently among top financial New Year’s resolutions business owners make each year. But with 80% of resolutions failing by Valentine’s Day, how can you do better in 2019? Here are our top 5 resolutions to protect your finances in 2019:
1. Reconcile your accounts receivable and payable
Do you owe any suppliers for work completed during the year? Are you still owed for a service you provided or a product you sold? It’s time to reconcile the work you’ve completed or had completed this past year, not leaving payments to be collected and then taxed the next financial year.
2. Prepare your accounts
For most business owners, now is the time to start preparations for filing taxes. Get ahead of the game and gather all important financial documents, business records, receipts, and anything else that can be used to prepare your filings.
3. Charge what you are worth
Do you often feel underpaid and undervalued in your business? Then make a resolution to revamp your strategy and raise your prices to accommodate the value you bring to your clients
4. Learn to manage your cash flow more effectively
Lack of cash is one of the biggest reasons small businesses fail! Make a pledge to invoice straight away upon delivery of your product/service and consider asking for a deposit upfront (or a payment part way through). Don’t be too lenient with your customers – be direct and fair and if all else fails, use a debt collection agency to get any overdue invoices paid
5. Create an action plan
Document what investments you hope to make in your business. Will you be rolling out a new marketing campaign, applying for a business loan, investing in product development, or increasing your office space?
For many people, the start of a new year is the trigger they need to change their behaviour patterns to help their business become more profitable and ensure financial security for their future. Try recruiting an ally (a work colleague, family member or friend) to help you reinforce your commitment - when you make your commitment binding, you increase your chances of success!
Don't set yourself up for failure by insisting on an all-or-nothing resolution. And certainly, don’t fall victim to the voice in your head that says, “You failed”. Sometimes all it takes to stay on track is to stop and consider whether, what you are about to do, is more important than your goal.