As 2017 begins, it is time to look back at how your business performed in 2016 and make it even stronger with the right financial resolutions. Clean out your financial closet and you will be set for a year of even better turnovers.
Here are five financial resolutions your business should be looking at:
Clear Existing Payments:
You do not want to carry the baggage of the previous year and make it a burden in the coming one. As the year begins, your first finance-focused resolution could be to make a list of uncleared existing payments. These payments could either be a debt for you or are dues that you are yet to receive, and include:
- Bank loan/investment EMIs
- Client and vendor payments such as payments for freelancers, payments from clients for projects, etc.
- Employee benefits like insurances, performance incentives, events, etc.
- Periodic maintenance/operational costs such as software license renewals, rent/lease agreement renewals, new recruitment, etc.
Segregate these payments between those which can be paid off in one go and those that will need to be broken up. This will help you clear out financial burdens and prevent your expenses from eating into your revenues.
Assess Avoidable Costs:
Reassess your financial strategy for the existing year and examine the errors. You are bound to come across avoidable expenses and ensure that your finance-focused resolutions save you from similar pitfalls. Dismissing these would mean better turnovers and return on investments, as your overall investment budget will reduce.
While you are re-looking into your business expenses, look at some of these ways to cut down costs:
- Instead of purchasing equipment/resources for short-term uses, put adapt existing resources to deliver the work
- Avoid additional work from external sources
- Maintain office furnishings and equipment on a regular basis to avoid sudden repair costs
- Assess the usage of utilities and limit it, to avoid over-spending
- Avoid late charges by making loans and periodic payments on time
- Assess the market requirement for your product to build an appropriate inventory and avoid building a significantly larger one
Evaluate Payment Gateways:
If your business is involved in making multiple transactions on a daily basis, you may want rethink your payment options as part of your finance-focused resolutions. Look for platforms with nominal transaction charges and those that that can offer you specialised benefits basis the number of monthly/yearly transactions. Transactional charges may seem negligible but in the long run can lead to a lot of unnecessary payments.
Opting for contemporary payment getaways can also lead to sales conversions as your customers may prefer using certain payment methods, such as online payments. Mobile payments make for easy use and simplify the activity of tracking sales.
Strengthen Your Team:
Your employees are a formidable base for your business and the drivers of growth. The New Year is a great time to make the necessary changes in your team and this year, make finance-focused resolutions – both in terms of layoffs and new recruitments. Though it may be slightly difficult, layoffs will ensure that problematic employees are removed, preventing expenses on salaries and maintaining a satisfactory working environment.
Additionally, hiring quality new employees will result in your business operating better with improved results. A quality team goes a long way in setting standards for your business and whatever you spend for maintaining the team is returned to you in terms of business revenue with profits.
Reset Your Cash Flows:
Cash flows determine how you enjoy your business revenues, so it is very important to maintain a well-timed cash flow. Assess your payment cycles and ensure that you have received all your revenue before setting the budget for your expenses. This finance-focused resolution will help you strike a balance between your outgoing and incoming finances, allowing you to improve your business operations with better funding minus the expenses.
Estimating your cash flow would also include cutting down on unnecessary expenses, as discussed earlier, and also exploring new ways to grow your business. Rethink marketing strategies to attract better sales, calculate your need of resources, and maintain an estimate of monthly business revenues for the coming year. This will ensure guaranteed growth for your business.
Here’s wishing your business a year of impeccable growth!
Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.
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