Entrepreneurs should start the new year by examining their past year’s business basics, in order to position their company for strong growth across the coming year, according to Ethel Nyembe, head of small enterprise at Standard Bank.
According to Nyembe, entrepreneurs should begin the year by “getting back to basics”, reviewing their business plan, and taking measure of how far their business has come over the last 12 months.
“If some of the targets you set – but didn’t reach – are still relevant, look at what you can do to exploit these opportunities,” Nyembe says.
“Reviewing your business plan should also inspire you to add in new targets and bring the document up to date so you can take your business up a level and go for growth in 2016.”
More specifically, Nyembe suggests entrepreneurs should examine a range of business documents, starting with their financial records for the last year – which will help to better navigate the coming year.
By looking at the year’s books, founders can identify which months were good and which were quiet – and why this was so. This, Nyembe says, will help to accurately plan cash flow, and make financial provisions, for the coming year.
The records will also enable founders to set realistic financial milestones for their business, and plan for attainable growth.
Further, she suggests making decisions on payments policy based on the past year’s records.
“Look at your payment terms and see whether there are suppliers who could possibly provide stock on consignment, or others that you could extend payment terms with,” she says.
“Decide whether the slow payers during 2015 are worth having on your books in 2016. Tightening your accounts policy for 2016 will ensure that slow payers don’t become a drag on your cash flow for yet another year.”
Next, Nyembe says while obvious, many business-owners don’t properly examine their past year’s sales records. This she says is a vital step in identifying popular products, and increasing stock availability accordingly. Furthermore, it may result in lower costs, by securing bulk discounts from suppliers.
Entrepreneurs should also take a long look at their marketing, and take steps to refresh their digital marketing policies in particular. This may involve redesigning their website, making online sales easier, or introducing value-added information to encourage customers to buy.
“Too many small business owners devote money they have ‘left over’ for advertising – their publicity campaigns are therefore often ineffectual and appear only occasionally. Having a proper advertising budget will ensure that you create ‘top of mind’ awareness on a consistent basis,” Nyembe says.
Finally, Nyembe recommends taking the time to research industry trends, consider any global trends that might impact local markets, and take stock of what market competitors are doing.
“Owning and running a small business often leaves little time for the owner to reflect on what can be done to improve the business and prepare for the year ahead with the economic outlook in mind. Finding time to reflect and assess can make all the difference.”