Writes Stephen McConnell, Business Services Partner at Baker Tilly Mooney Moore. Article first published in the Irish News, Tuesday 9 January .
Stephen McConnell, Business Services Partner at Baker Tilly Mooney Moore
The New Year is the perfect time to reflect on what your business has achieved, reassess your financial strategy and plan for the year ahead. After years of economic uncertainty, it’s important to embrace it with optimism and set clear goals for long-term success in 2024 and beyond.
Though the early months of the year can feel overwhelming with self-assessment deadlines looming and audit season in full swing, it’s also a good time to consider implementing changes that might boost your efficiency or expose you to new market areas.
Despite the recent stabilisation of inflation, overhead costs will remain high well into 2024. Cashflow management, sensible budgeting, and regular income and expenditure reviews still take top of the priority list. In the new financial year, businesses need to focus on one of their biggest overheads, their staffing bill.
In April, the national living wage will increase by 9.8% to £11.44 which, despite being good news for employees, will hit struggling businesses hard.
As the cost-of-living crisis continues, consumer confidence is low, even after a busy festive period. Business owners should create detailed forecasts, factoring in scheduled living wage changes. Having a live budgeting system will allow you to react quickly to any cash injections or unexpected hits throughout the year.
To maximise deductions and incentives, individuals and business owners should take time to assess their obligations and seek out opportunities. Take account of R&D tax credits and consider whether any potential upgrades might qualify for government incentives.
Years of economic instability have created a stressful operating environment for businesses. Understanding the warning signs of a struggling business is fundamental to avoiding financial distress. Lengthening creditor payment days, struggling to pay taxes, or an inability to upgrade technologies are key signs of financial distress. If you see these symptoms, voice your concerns early to allow professionals to advise on the best course of action.
While there has been some easing in the recruitment market, curating a suitable team and striking a balance when it comes to flexible working, salary scales, and appropriate benefits to retain valuable team members remains challenging. Looking to 2024 and beyond, business owners should be open minded about their team size, structure, and culture.
Unfortunately, market uncertainty and the high cost of doing business are issues that have followed us into 2024, but the New Year also brings new opportunities for growth. Settle your business plan now for the year ahead but remember to always be flexible and take business advice when considering a new opportunity.