How do you start the financial year off right? Hit the “refresh” button on your business!
Every business owner can uncover inefficiencies and discover potential improvements if they look closely enough. The business environment is constantly changing, no matter what industry you’re in. To stay ahead, it’s essential to regularly assess all aspects of your operations – from marketing to sales to finances – and to search for ways to refresh your business.
Updating your Systems, Operations, and Customer Journey
The concept of refreshing your business might sound intimidating – but there’s no need to overhaul anything that’s working well. Instead, the point is to make positive changes within the major areas of your business so that you can stay competitive while offering your customers a top-notch experience.
How to refresh your business…
Systems can make or break a business. Without the right processes in place, everything becomes complicated. For example, it’s tough to train a new hire when you don’t have a process for onboarding employees, and it’s challenging to collect feedback without a system for communicating with your customers.
Refreshing your systems involves looking at your current methods and seeing what should be updated. For instance, are you using outdated technology that could be replaced with something better? Are some of your systems too hard to use because they’re confusing or tedious? Exposing the weak links in your systems is critical for future success.
Operations and systems updates go hand-in-hand. Strong operations are essential for staying on track with your business goals, managing your team, and building a foundation for future growth. In product-based businesses, operations teams handle logistics, inventory, sourcing, and other product-related tasks. For service businesses, operations teams ensure that processes run smoothly and that documentation and training are in place for employees.
To refresh your operations, look for inefficiencies or gaps in communication that can be closed up. For example, you might notice that your process for paying vendors takes too long and could be sped up with a few simple tweaks. Tighten up holes like these in your operations to avoid future issues.
The customer journey is essential for the success of any business. When your customers have a great experience, they’re more likely to share your brand with others. Even slight frustrations, like subpar customer service or infrequent communication, can drive a wedge between you and your customers. Refreshing your customer journey involves looking at each step, from the initial contact to after a transaction has ended, to ensure that the experience is excellent at all points.
Having the right message is critical for reaching customers. It may seem like a small thing, but a meaningful, memorable slogan or a value-driven message helps customers recognise and appreciate your values. Every once in a while, it’s wise to assess your messaging and experiment with different ideas.
Your target market can change depending on your products and services, your pricing, your branding, and many other factors. Nailing down your target market is key for long-term success. To refresh this part of your business, think carefully about your messaging and values and build a profile of the person you’re trying to reach. Regularly assess this profile to ensure that it’s still accurate.
How to Maximise your Cashflow in your Business
Refreshing your business is one step along the path toward maximising your cash flow. There are five key principles to maximising cash flow in any business:
- Understand that cash flow is the lifeblood of business. If your margins are poor and you can’t get a handle on your finances, it doesn’t matter if you have an endless stream of customers who are willing to buy your product – your business won’t be profitable unless you focus on cash flow.
- Budget for working capital. Businesses in the startup mode need to have working capital to fund purchases like inventory, payroll, and overhead. You need to make sure these costs are accounted for to keep your growing business afloat.
- Know your cash flow drivers. Every business owner should know the levers in their business that affect cash flow. Examples include your process for ordering stock, invoicing customers, and collecting payments. Each of these things can positively or negatively affect your business depending on how they’re managed.
- Create a cash flow forecast. Entrepreneurs should prepare a cash flow forecast statement at least yearly. This statement allows you to make predictions about the financial health of your business. It’s also useful for obtaining bank financing since bankers will often want to see your forecast before approving a loan.
- Avoid the underlying causes of poor cash flow. Your cash flow can suffer for many reasons, including high overhead costs, poor accounts receivable and accounts payable processes, low profit margins, or slow inventory cycles. It’s key to assess your cash flow bottlenecks so that you can prevent issues.
Get your 2021 taxes in order now!
Tax planning is key for proper cash flow forecasting and overall business success. Don’t wait to get started – May is the perfect time to let Vibrant Business help with your financial concerns so that you can focus on other tasks.
Vibrant Business will help take care of all of your business financial needs. From tax and accounting to bookkeeping, coaching, and mentoring, we can help you plan and structure your business to achieve your milestones. For more information on these services, please contact us or book a time to chat here.