Running a small business can be hectic, which can be a good sign that your business is thriving. But amid the blur of to-do lists, phone calls, emails, employees, customers, and last-minute crises, it's easy to lose sight of the big picture.
Do you have enough cash flow to keep paying your employees during the slow season? What about employee bonuses, distributions for yourself, and that new tax law? What goals do you have for the future, and what risks and threats do you and your business face?
The end of the year is a critical time for business owners to take stock of where things stand and identify areas for improvement. By working through this end-of-year checklist, you'll be ready to set goals that will help your business move ahead in the new year. Here are 10 key items to focus on:
1. Run Financial Reports
At a minimum, put together a profit and loss statement, a balance sheet, and a cash flow statement. Look at where your money went last year and determine whether you are on track to meet your profit goals and cash flow needs.
2. Get Your Vendor Lists in Shape
Update addresses, phone numbers, and the names of your key contacts. Delete or archive vendors you don't use anymore. This yearly housekeeping will help keep your lists organized and ready for orders and payments in the coming year.
3. Update Employee Information and Consider Bonuses
Make sure you have accurate contact information for your employees and that you have properly accounted for employee benefits. Decide whether you'll give employee bonuses, and set an amount.
4. Back Up Computers and Mobile Devices
If you use cloud-based software, you may think you're covered. But experts caution against relying on just one backup method—even if it's a well-known cloud service. They recommend backing everything up on two digital platforms, in two locations, plus having one copy in print or on a local server or hard drive.
5. Take Inventory
If you keep goods in your store or warehouse, an end-of-year inventory lets you reconcile your numbers and identify any large discrepancies that could indicate accounting issues or theft. It also shows what's selling well and what's not, helping you decide what to pursue in the year to come.
6. Make a List of Your Business Accomplishments Over the Past Year
It's easy to forget about the milestones you've achieved and the obstacles you've overcome. Listing them is a great feel-good task. Once you've made your list, be sure to share it with your employees and recognize them for their contributions.
7. Meet With Your Accountant
The new tax law has changed many things for small businesses—including expense reporting. This makes an accountant appointment especially important this year. Go over your financials and get advice on bonuses, distributions, and end-of-year tax strategies. Also talk about tax planning for 2019.
8. Talk to an Attorney
Making the time for an annual legal consultation can show you what you need to do to keep up with regulations, contracts, and employment laws that affect your small business. An attorney also can help you evaluate and minimize the legal risks you or your business may face.
9. Identify your Staff, Hiring, and Outsourcing Needs
The end of the year is a great time to think about the tasks you don't like doing or don't have the time or expertise to do well. Make plans to hire staff or outsource to consultants to take some things off your plate. Decide whether you'll need a larger workforce in the coming year and, if so, budget the money to pay for it.
10. Take a Good Look at Your Website
Your website should not be a "create it and forget it" item. Go through your site and click on every link to make sure it works. Send yourself a note using the contact form and confirm that it's functioning. Does your website look fresh and up to date? Does it match the image you want your business to project? If not, put a website update on your list for next year.