7 steps to get ahead with your business in 2024

on 19 March 2024 / by Tom Beswick

“Getting ahead with your business in 2024 isn’t just about ambition; it’s about mastering the crucial pillars of accounting and finances,” asserts Tom Beswick, Director of Ingham Mora, as he unveils seven transformative steps to empower business owners in navigating the financial landscape of the new year. Read his 7 steps below...

This is going to be a boring read. It is about accounting and finances. But if you are a business owner it might just change your life. Here are my 7 steps to improve your financial processes within your business. If you follow these tips, I know you will feel more in control of your business and you will make more money.

  1. Reconcile your Xero file regularly – at a minimum weekly. Your financial reports will be misleading if you have unreconciled transactions. Financial reports tell you where the opportunities for improvement are in your business – they must be reliable.
  2. Setup your suppliers as creditors in Xero – frustratingly many businesses do not enter their supplier bills to pay in Xero. If your March supplier bills are not recorded until they are paid in April then how do you know how the business performed in March? Costs should be recorded to match the sales. Entering bills makes your financial reports more accurate and planning easier.
  3. Set a goal for closing your month end – this means your bank accounts are reconciled, invoices sent, bills entered, and a financial report for the month and year to date is run. You should not be sending invoices for last month weeks later. A good goal is to do this within 5 business days.
  4. Monthly budget preparation – budget for the next financial year and report against it. No, copying last year is not sufficient. It should be uploaded to your Xero file.
  5. Regular financial review – set time each month to review your financial information. If you do not review your numbers, then how do you know how things are going? If you want to run a good business, then you will not just rely on how busy the team is this week– or whether there is cash in the bank account. Review your monthly results against budget – particularly looking at key performance indicators (i.e. gross profit % for many). Agree with your team the specific actions you will take this month to improve (note working harder is not usually the answer). Important – put a recurring monthly placeholder in your diary to review your numbers and do not skip it!
  6. Keep a rolling cashflow forecast. There are lots of apps that make it easy. Or a simple excel sheet can be learnt in 30 minutes. If you have a cash crunch coming up would you rather know about it when the bank is empty – or with 8 weeks’ notice? I know what conversation your bank manager would rather have. You start with your current bank balance, add the money you think comes in this week, and the money going out. That gives you an expected closing bank for the week. Then you push out the assumptions say 8 to 12 weeks. It will never be perfect but that is not the goal. The goal is to be able to take action weeks before a problem hits you – rather than days.
  7. Get some financial training – if all this is a foreign language to you then meet with your Chartered Accountant and fill in the gaps. If they are talking in jargon or are not good communicators, then find a better one. Every business owner can master these basics within half a day if focused.

My best clients do all this. They do not make last minute calls when they cannot make payroll. If you would like to never be in that position, then I suggest you implement these tips. I guarantee you will increase your chances of running a successful business.

If you have any questions or need further guidance on implementing these strategies, feel free to contact Tom. Your proactive approach to financial management will undoubtedly pave the way for a more prosperous business journey in 2024 and beyond.