There is always something to do as a business owner. And we don’t always do or focus on what makes the biggest impact on the business. We become distracted with the day to day running of the business, putting out fires and doing menial tasks like checking our inbox and administration when we should be offloading these duties to other resources.
Business owners often spend more time working in the business than they do on the business and many Australian business owners work 50+ hours1 a week.
The sectors putting in the longest hours are transport, primary industries such as agricultural and mining, financial services and insurance.
This is a handy reminder comprising 10 areas that need regular review when running a successful business.
1. Watch trends in your industry
Compare your business performance with your industry competitors and to your own performance in previous years. Look at who is entering your market and how they are doing things that may attract your clients to them.
- What are they doing differently?
- How are they marketing and selling their products and services?
- Is their digital footprint better than yours?
- What makes their offer better than yours?
- How can you retain your clients better?
2. Review your market and sales/marketing plans at least every 3 months
This might sound like a lot of work, but the more often you are measuring your results the easier it is to highlight what is and isn’t working. It will help you manage the KPIs (Key Performance Indicators) of your sales team. It will also be a lot easier to make those small adjustments to keep attracting new business and retaining existing ones.
3. Review your financial management
Timely accurate reporting is vital to the success of any business. Make sure you reconcile your accounts at least once a month. With the advance of technology and online banking it is easy to reconcile as often as you like. Don’t let this get out of hand.
4. Ensure your budgets are current and regularly reviewed
Firstly, make sure you have a budget and it is realistic. If profit falls below what you had budgeted, prompt action is essential to reduce costs or boost sales.
5. Align your business development plans with your budget
Ensure they are practical and won’t place any undue pressure on your profit margin. If you can’t afford to do or buy something now, postpone it to when you know your business will be in a better financial position.
Or chat to us about getting through a tough time with finance options such as:
- cashflow/invoice funding
- debtor finance
- equipment leasing and hire purchase.
Track your advertising and marketing activities and the associated costs against the sales made to ensure your money is being well spent. If not, make adjustments.
6. Ensure credit control is tight with prompt follow up of overdue customer accounts
Ensure your clients are aware of your trading terms upfront. Maybe you need to review your customer payment
terms and bring them forward? Or if your cashflow model allows, consider offering incentives for prompt or early payment. If you have any concerns about your clients’ potential to pay for your products and services, discuss this before the sale is made or refer them elsewhere. Having no clients is better than having clients who can’t or don’t pay.
7. Review your supplier payments policy
Are you taking maximum advantage of prompt payment discounts with your suppliers? If you are unable to pay an account in full by the due date, talk to the supplier beforehand and negotiate a payment plan. Make sure you keep the communication open and honest and fulfill your promises. It is more likely to be respected and easier to negotiate when you have communicated before you miss a payment.
8. Review credit facilities with your finance team
Are there better finance options available that could save you money? With the increasing interest rate market over the last 12 months, NOW would be a good time to review your finances across the whole business. Lenders are always fighting for new business. You may be surprised at the offers available to business owners at the moment. Make sure you book a finance review with us so we can head you in the right direction.
9. Check inventories and ensure your stock turnover rate is at least equal to industry standards. Holding too much stock costs money. As does not having enough stock in place. There needs to be a commercial balance that works for
you, your customers and your business.
10. Above all – DO IT NOW!
If things look bad, take action to correct the situation. Look for positive approaches to solving any problems and consider new opportunities to build your business.
These all sound pretty simple, but with the day to day running of a business it is easy to let the simple things slide.
For your peace of mind and success, allocate time in your diary and commit to these important tasks.