business planning  finance  tax 
While people everywhere are trying to decide whether this year’s resolution will be to lose weight or stop smoking, David Underwood has some more realistic ideas When this is printed we will be well into the “so many shopping days to Christmas” period. Holiday fever will be on us with all the unusual pressures that go with the end of the calendar year business cycle.

It will also be closer to New Year’s eve with another lot of celebrations and more pressure for you to make some New Year resolutions. Could I suggest you think seriously about making some serious resolutions this year. You won’t regret it especially if you work on them during the coming year and are serious about the outcomes.

I will concentrate on the work related resolutions but that does not mean you should overlook personal ones involving the family. Those are important but outside the scope of this article.

My suggestion is that you have three resolutions you can concentrate on rather than a heap of them which you know would be unworkable. One would be personal with the others being business related.

Lets start with the personal one. First up I suggest you arrange for a full medical check up. If you do that you will find out if there were going to be any nasty surprises. Then look at your fitness. Are you unfit and over weight? If that is your problem then ask the Doctor how to best overcome the difficulty.

It may be a combination of diet and amount of exercise and both of there are easily fixed. They may need some change of habits but that is a small price to pay if you want to go the distance and enjoy your superannuation benefits. It is easy to look after your health and becomes second nature so you don’t have to constantly worry about how you are living.

With the personal resolution out of the way it is time to look at the desirable business ones. That too should be simple. Look back and see what the problems were for you and then look closely to see what caused those problems. Carry out the same processes for what went right so that you can work to overcome the problems and enjoy more of the good experiences.

Overall I would expect any business person to resolve that this new year the business was to be successful. I don’t know anyone who set out to fail.

If you are to succeed then you need to trade at a profit. That means you have to have more income than expenses and that does not often happen by accident. You have to know what your costs are so you have to have a budget. It does not have to cover the cost of the last packet of paper clips but does have to cover the major costs in some detail.

Those costs will be labour and materials. Labour is a major variable so you need to have good staff training and supervision if like most businesses you have to give a quote for each job. There is not a lot of charge up work around but if there was then life in business would be a lot easier.

Material costs can vary a lot over time so you need to have systems that tie your material purchase costs with your material selling costs. The other big variable is the volume of sales. If you allocate your overheads on the basis of your sales and you sell less than anticipated then you will not have as much overhead cost recovery as you thought. Your profit will not be there and you could make a loss for the year though the actual jobs were profitable. Think about that.

I think that the business resolution can be kept quite simple and suggest something like this. To be successful I will make it my business to know and understand my business. Write it down along with the resolution about your health.

The third and last resolution is very simple and is to keep the two earlier resolutions under regular and serious review. Make it your business to check progress monthly and when I suggest regular reviews that is exactly what I mean. Write them down and check progress regularly. Make the time to do it. If you don’t then no one else will and you will be the loser.