Small Business Insanity - Turning Up Hoping This Year Will Be Better?

INTRODUCTION:

It's the start of a new financial year and as a small business accountant I often see business owners who either:

• do nothing to effect change;
• say "I must see if we can do something different this year." but actually do nothing; and
• those that decide "enough is enough" and take action.

Now unless you are one of the fortunate ones who have their business on a string and are just ploughing along blissfully (and even then I would say 'never get complacent'), hoping the next year will be better than last is a dangerous if not very lazy strategy.

How then would you score yourself for the last 12 months?

Figure 1: Is your business like groundhog  day?

1. Cash Flow Seems Tight

If you have had a hard year cash flow wise chances are business is not going as well as it could be and you need to get to the bottom of why it is you struggle for money in the bank.

Sit down with your small business accountants Sydney & Dubbo and use a three way budget to help you establish a business plan that will generate cash. Cash flow forecasts are critical to a business's success. Even better a cash flow forecast, profit and loss budget and a balance sheet budget that all talks to each other is a very pinpoint document that will assist you with your business strategy.

After all, business valuers will tell you that unless you have a business that generates positive cash flow, the size of the small business valuation will generally be much smaller than it would have been even if it is making the same profit.

Two businesses making the same profit but one never has much cash - which one would you prefer to buy?

2. Customers Are Leaving

If customers are voting with their feet you need work out why. When was the last time you worked out how many customers you were acquiring each year and how many you were losing? Getting new customers is very expensive and never forget the lifetime value of a client.

3. Staff Aren't Happy

How are your staff travelling? Would you say they love working with you? Do you have the right people on the bus or do you need to go around the roundabout and open the door and accelerate?

4. You Feel Like Doing MMA on Your Clients &/or Your Staff

Figure 2: Do you have days that you feel like being Bruce Lee & want to perform mixed martial arts?

If you aren't happy yourself at work then chances are neither will your team or customers. Are you a moody boss or are you happy to be at work and encourage people to work towards the team goal?

There's nothing worse than trying to do business with somebody who is cranky. You can sense it affects the whole organisation and is not a good look.

5. You Are Not Inspired

If you aren't inspired and looking to find ways to do things, how can you expect others in your organisation to so the same. An inspired leader always looks for ways to do things better, faster and more efficiently. Have a look at your small business accountant Sydney and Dubbo - do they inspire or are they just doing the same year in year out? Hopefully you will be able to draw some ideas from them as you work your way through to business redemption.

What are you doing that inspires your team and your brand?

6. Unless You Do It Yourself Nothing Will Get Done

Figure 3: Turning around your business seems bigger than Ben Hur - You are meant to be working together not be in competition.

If you find that your business cannot function without you, you probably don't have systems in place and you won't be spending time on the things that will improve your business performance.

A business that relies on the owner too much will not get as high a business valuation as one that doesn't.

CONCLUSION:

It's always a good time to effect change. The start of the financial year is as good as any.

If some of the above symptoms seem to ring true, don't sit there whingeing about it. Do something about it!