7 Things To Review For Enhanced Business Performance
If you are a business owner in Australia, there’s a big chance that you are now back at the desk after a break. The Christmas holiday period is a great time to rest and reflect over the previous year and think about what you want to achieve in 2019.
There’s no better time to review the performance of your business given you should have a team that’s rested and ready to help you achieve your goals and growth targets for 2019.
Here’s our guide for the critical business activities to prioritise reviewing to ensure if you’re on track for a good year.
1. Review your reporting systems
Take some time to understand how you currently measure effectiveness. Particularly sales and employee performance. Do you know what your cost of sale is, whether you are achieving sales at the right costs and what the most effective sales channels are?
2. Review your cash flow requirements
Cash flow constraints can considerably hinder business growth. Effective balance sheet management of accounts receivables, accounts payables and inventory levels help make sure that you have sufficient cash to operate effectively. It’s also critical that adequate cash is being set aside to meet Tax and Super obligations
3. Review your products and services
If you have good reporting, you’ll understand how profitable each of your products and services is. Understanding this means you can plan for the year ahead, focussing on promoting profitable (and eliminating unprofitable) products or services.
4. Review your staff performance
Do you have good systems for understanding what your team members are working on and also for recognising achievements? A strong culture and communication amongst staff will ensure your team is motivated and focussed on the overall company objectives.
5. Review your operating costs
Getting a handle on all your operating costs and then reviewing for improved deals and more competitive suppliers can have a significant impact on profitability. You can even task staff with finding ways to streamline costs and reward them for finding savings.
6. Review your most profitable customer relationships and satisfaction
Understanding which customers are generating the most revenue and or profit should be a top priority. After all, we all know it’s cheaper to retain a customer than to acquire a new one. Customer retention has a considerable impact on growth. Using tools such as Net Promoter to track customer satisfaction and the likelihood of referral can streamline satisfaction monitoring.
7. Review any debt or finance arrangements.
Make sure you have the most cost-effective finance facilities in place, and you are reducing any debt effectively.
Last but not least, make sure that you involve your trusted advisors in helping you review your business. An experienced advisor can help you take an “outside-in” look at your business and also bring valuable experience and therefore suggestions for improved business performance.
PrimeAccounting specialise in working with private business owners, keeping them on track with finance and accounting services. Contact us for an obligation free Business OnTrack consultation on improving your business performance.