Writing for Business Advice, FreeAgent chief accountant, Emily Coltman, outlines four resolutions small company owners should take on board to maximise profits in the new tax year.
The new tax year is upon us, which means that it’s a perfect time to start thinking about making some changes and improvements to your business to help it flourish over the next 12 months.
So if you’re planning to make a splash in the new tax year, here are four resolutions to implement in your business.
Track your time
Interruptions are a massive productivity killer for many business owners, so it’s a good idea to track all of your working time (including all your phone calls and coffee breaks) in order to see where the main interruptions are in your business and be better equipped to deal with them so you can work at full strength.
This will also enable to identify how long you spend doing non-work-related tasks, whether you’re procrastinating and need to address this, and which parts of your routine are least productive.
By tracking your time, it’s possible to discover how profitable each project you work on is, as you’ll be able to see how much “unbillable” time goes into each one, compared to the amount of time you can charge for.
That means you see which projects are costing you money and what kind of work you should be focusing on in the future to maximise your profits.
Review your customer base
The start of the tax year is a great time to take a look at your list of customers and see which of them are most valuable to your business – and which are more problematic.
Look at all the time logged against a customer, including any unbillable time like chasing invoices or extra support requests.
You may find that some of your customers take up a great deal more time than others for about the same amount of money, or even for less. In those cases, it’s a good idea to decide whether those clients are ones you love going the extra mile for, or if it might be better in the long run if you stopped working with them.
You may find that unbilled time you’ve spent on some customers can be better spent finding and working with amazing, new clients instead.
Just remember not to take the great clients you currently have for granted. Make sure you keep them feeling special and valued because happy customers tend to be more willing to recommend you to their friends – and positive referrals are one of the best ways to grow your business.
Freshen up your marketing
Take some time to properly re-evaluate your marketing efforts and see whether there is anything that you can be doing better in the year ahead. For example, it may be time to start thinking about advertising in local media or signing up to attend a trade show full of potential new customers. Or you may just need to tweak your SEO and online presence in order to more effectively target a specific customer base.
Before you get started, take time to make sure you’ve worked out your Unique Selling Proposition (USP) and perfected your elevator pitch. That way, you’ll start out on the right foot when it comes to spotting new marketing opportunities.
Keep in mind that you don’t have to spend a huge amount of money either. Large corporations may have millions to spend on marketing, but with a little creative thinking you can still achieve great results on a more modest budget.
Get your books in order
Managing your accounts isn’t the most glamourous or exciting part of running a business, but it’s still one of the most important pieces of admin. You need up-to-date accounts to see how much money you’re making and how much tax you need to pay, and in order to do this, you need to have a good, robust bookkeeping system in place.
The key is making your bookkeeping an integral – but manageable – part of your working routine. So, this tax year try dedicating a specific slot of time each week to reviewing your bank transactions, logging your expenses and managing your invoicing rather than leaving everything to pile up.
Even just an hour each week will enable you to stay on top of the admin, see at a glance how your business is performing and avoid any nasty surprises down the line!
Emily Coltman FCA is chief accountant to FreeAgent, which makes award-winning cloud accounting software for micro-businesses, freelancers and their accountants.
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