Just because Christmas is a distant memory, doesn’t mean you shouldn’t keep on checking your list…. we mean your annual business list, that is. The beginning of a new year means you can begin to put the old year behind you and solidify your annual plans and goals… and February is definitely not too late to start planning!
So, what should you be prioritizing this year? Here are four areas to cover to help you achieve success in the new year.
1. Tax planning
- This year is over — organize last year’s receipts, paid invoices, credit card slips and cancelled checks.
- Make an appointment to see your accountant, or schedule time to work on your taxes yourself. Dreading it? Use business tax accounting software like Wave, to make it easier.
- Estimate how much you should take out of your business for the year ahead as income. While the individual who prepares your tax can help you, your options will depend on how you set up your business, and your expected expenses for the year.
- Ask the individual who prepares your tax about strategies to reduce your tax bill for the upcoming year. For example, big equipment purchases may not be a tax deductible business in expense, but their depreciation can be amortized over multiple years.
- Did you miss invoicing a customer, or overlook a customer who still hasn’t paid? Consider signing up for an invoicing software.
- Create two profit and loss statements (P&L); one for last year and one to track the upcoming year. Basic P&L statements track sales, expenses, and the difference between the two, for a given time period. A P&L can be one of the best tools to see how well your company did after all your expenses. Not sure where to start? Read our guide to financial statements for beginners.
- Look at your cash flow for last year. Did your business ever lack working capital that kept you from taking advantage of opportunities? Perhaps a loan or line of credit would help you this year?
3. Business planning
- Take advantage of any slow periods at the beginning of the year to think through — or make — plans for the upcoming year. Having a business plan means you can be intentional about how you run your business rather than reactive.
- Make a detailed business plan with goals broken down by month. Want to expand your business this year? Launch a new product? Increase revenue by 25%? If you don’t plan for how you’ll do that, you might end up making the same business resolutions next year.
- Create a calendar for promotions, marketing initiatives, and other dates that are critical to your business this year. You might want to use a business productivity tool like Airtable, Monday, Asana or Trello to help with this, along with other small business software solutions to streamline your business planning.
4. Performance evaluation
The beginning of the year is a time to set goals but also to look back on the goals you set last year. For that reason, it’s a great opportunity to assess how your business did.
- Create an overall picture of how you did last year using your P&L, cash flow and any client feedback from the prior year. Then strategize how you can adjust your tactics this year to try to get better results.
- Consider getting a business coach or mentor. Ask friends for recommendations or introductions, reach out to people you admire, or go to business networking events with an eye on meeting potential mentors. An experienced business coach can help you identify areas that need work and help troubleshoot how to achieve your goals.
- Not sure what you did wrong, and more of a DIY-er? Check out this “Don’t Do List” for inspiration!
Continue your progress with the new year ahead
Running a business on your own is difficult because there are all sorts of distractions — from the side hustle you work to help pay the bills, to family members who barge into your home office while you’re trying to get work done. Sometimes your well-laid business plans go by the wayside.
But if you want to achieve your annual business goals, make a new year’s business resolution to plan ahead and monitor your progress throughout the year. A solid plan based on your experience last year can mean you’re in a better position to own the year ahead.
This article offers general information only, is current as of the date of publication, and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While the information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by RBC Ventures Inc. or its affiliates.