Businesses are always looking for ways to improve their financial performance and accelerate their growth.
This is a common theme that comes up as the end of the financial year approaches and strategising for the new year begins.
Here are five tips that I would recommend to achieve financial objectives before the end of the fiscal year and successfully set up the next 12 months.
Review Your Financial Performance
To understand your current financial position, you need to start by reviewing your income, expenses and current cash flow. This will help identify areas where you could cut costs, increase revenue, and improve efficiencies. You should also do a review of your financial statements, including your balance sheet and income statement, to realise the financial health of your business. Once you have that information, you can develop a financial plan that aligns with your growth objectives moving forward.
Set Clear Financial Goals
Once you have your ducks in a row, you can set clear financial goals moving forward. Your goals need to be specific, measurable and achievable, and they need to align with your overall business strategy. Goals such as ‘increase revenue by 20%’, ‘reduce costs by 10%’, and ‘improve cash flow by implementing more efficient payment processes’ are great examples. By setting clear objectives, you’re creating a roadmap for your business growth that you can track over time.
Manage Your Cash Flow (More) Effectively
Effective cash flow management is critical to the success of any business, especially in the current economic climate. To accelerate your growth, it’s important to regularly monitor your cash flow, forecast for the year ahead, and identify ways to improve it. This can involve negotiating better payment terms with suppliers, streamlining your invoicing processes and system, and incentivising early payments.
By efficiently managing and increasing your cash flow, you’ll have the resources to invest in other areas of your business, and increase opportunities for growth.
It’s also important to be aware that if you have debts with the Australian Tax Office, that you have a payment plan in place. Otherwise, this could have a direct negative impact on your ability to secure financing and potentially jeopardise your current financial position and any other financial arrangements you might have in place. To mitigate the risk, you’ll need to review your ATO obligations and prioritise paying off any debts.
Additionally, don’t forget to follow up with customers with outstanding invoices and account for them. You may need to claim tax deductions, if you’re eligible.
Invest in Your Business
One of the key areas that business owners overlook is investing in the business, even today. It can be as simple as investing in new equipment, technology and staff training, or as innovative as looking at research and development into new products or expanding into new services. This means taking an unbiased consideration of your business’s strengths and weaknesses, as well as the opportunities and threats in your industry.
Ensuring the financial implications of investments means developing a financial plan for each one that aligns with your growth objectives and strategy. Investing strategically in your business can improve your competitive advantage, expand your customer base, and position your business for long-term success.
Outsource Financial Services
Outsourcing C-suite capabilities means gaining access to valuable skills and experience without the price tag of a full-time employee. It can help you accelerate your growth by freeing up time and resources to focus on growing your business.It also enables you access to a wealth of expertise from a team with more capabilities than just one person can manage.
You might include outsourcing your bookkeeping, compliance, management accounting and board reporting to qualified professionals. When you outsource these services, you ensure your financial records are accurate, up-to-date, and compliant with relevant regulatory requirements. You also gain access to experienced financial professionals who can help you develop a financial strategy that aligns with your growth objectives and can also monitor your financial performance to identify opportunities for further growth and investment.
Understanding your past performance and current financial position is vital for positioning your business to meet your growth objectives and ensure long-term success.
Opportunities and investments are particularly important for the long-term sustainability of any business, and the new landscape of business has opened opportunities to access outsourced expert financial services that offer more than an in-house accountant or financial manager can for support, advice and accelerated growth.
Keep up to date with our stories on LinkedIn, Twitter, Facebook and Instagram.
