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 uncertainty and economic instability, our team is looking forward with optimism. Here, we share our advice on setting clear goals and objectives for long-term success in 2024 and beyond.
Be innovative in your planning
Though the early months of the year can feel overwhelming with self-assessment deadlines looming and audit season in full swing, it is also a good time to embrace new innovations, implement new ways of working and consider any business improvements you wish to make.
Audit & Assurance Partner Joanne Small advises: “Deadlines and regulations can leave business owners feeling that their creativity is being stifled, however ingenuity will always have a place in business planning. Use the inspiration of the New Year as a fresh start and consider implementing any changes that might boost your efficiency or expose you to new market areas. Plan early in the year and always involve a trusted business advisor if you are contemplating a major change.”
Produce live budgets and review them regularly
Despite the recent stabilisation of inflation, overhead costs will remain high well into the New Year. With this in mind, the practices of cashflow management, sensible budgeting and regular reviews of income and expenditure still take top of the priority list. In preparation for the new financial year, businesses will need to pay attention to one of their biggest overheads, their staffing bill. The national living wage will increase by 9.8% from £10.42 to £11.44 in April which, despite being good news for employees, will hit struggling businesses hard, particularly those operating in the hospitality and retail sectors.
“Though we have seen the return of a busy festive period, consumer confidence is still not secure as the cost-of-living crisis continues to bite,” Business Services Partner Stephen McConnell reminds us. “Business owners will therefore want to create detailed budgets and forecasts for the year ahead, factoring in scheduled changes in the living wage. Having a live budgeting system will allow you to react quickly to any cash injections or unexpected hits throughout the year.”
Maximise Deductions & Incentives
Tax Director Neil Armstrong advises individuals and business owners alike to take time in the New Year to assess their obligations and seek out opportunities. Many will be anticipating the recently announced reduction in National Insurance contributions for employees, sole traders, and partnerships, however there are also business incentives available to leverage. Take account of R&D tax credits and consider whether any upgrades you plan to make, including energy-efficient changes, might qualify for a government incentive or reward.
Neil Armstrong said: “We enter 2024 with some small signs that the pressure in the economy is easing, and with several tax changes due to take effect following the Autumn Statement. Take time to review your situation and forward plan for both your business and personal finances, to ensure you are in the best position possible.”
Voice your concerns early
At Baker Tilly Mooney Moore, we understand that years of economic instability have created a stressful operating environment for business owners. Having supported many recoveries, however, we also understand what causes financial distress, and how to avoid it. Understanding the key warning signs of a struggling business is a fundamental aspect of running your operations in the right way. Restructuring & Insolvency Partner Darren Bowman explains: “Lengthening creditor payment days, struggling to pay taxes, failing to pay pension deductions or being unable to make essential repairs or upgrade technologies are key signs of financial distress within a business. If you see these symptoms, taking professional advice immediately will allow us to advise on the best course of action. Ultimately, it’s about voicing your concerns early and often to avoid deepening financial distress.”
Embrace the diversity of your team
While there has been some easing in the recruitment market, curating a suitable team and getting the balance right when it comes to flexible working, salary scales, and the appropriate benefits to support and retain valuable team members remains a significant challenge. Looking to 2024 and beyond, Consulting Partner Donal Laverty says business owners should be open minded about the size, structure, and way of working within their team.
“The great resignation, the advancement of AI, salary inflation and the emphasis on diversity and inclusion have all driven unprecedented changes in the HR environment. No matter the sector, the people within your business will always be your biggest asset, so leaders and managers should embrace the changing culture of the workforce and pay attention to technological breakthroughs, employee trends and new developments in HR & L&D. Invest time into your people management and seek advice if you have specific concerns or needs.”
Get in touch with our team on T: 028 9032 3466 to talk about any aspect in more detail.