We are now into the new year and of course that always means setting our goals and getting new things started. It also means I get a lot of calls from people who started a new business in the previous year and now realize they must pay taxes. So how do you get a business started.
The first thing is to let your tax preparer know you started a new business. This is important for several reasons.
- Your tax preparer is familiar with lots of businesses in your area all of which love to help new businesses get started and may have the need for your services. When you don’t let them know you are losing valuable networking opportunities
- Not all tax preparers are alike – most of us specialize in different industries and your current preparer may not have the knowledge of your industry that will be needed – this is not always a bad thing because they can quickly find the industry specs you will need but not if you don’t tell them
- Tax planning is always important – you need to know how this new endeavor is going to affect your taxes and the kinds of forms needed – in addition the due dates for business returns are different than personal returns and you don’t want to be late filing simply because you didn’t ask the questions needed.
Second is to create a business plan or to update your business plan – this will give you a starting point with goals for the business in the new year – this is not just for new businesses, but all businesses should do this every year – if not at the beginning of the year then get it on your calendar. We all tend to think that if it has a schedule with a date and time for it to happen then it is important and is more likely to get done.
Third is a budget. Without a budget you can’t determine if you are doing well or not – having money coming in is not enough if you don’t know where the best places to spend it are to grow your business. It is even more of a problem when you are just starting and have lots of expenses but no money coming in. Having a plan for when cash flow will get stated can save your small business.
The final step is to set up key indicators – this is last because you must have the plan and the budget before you can determine what indicators are going to be important to you. For some businesses it is important to know how many sales calls were made where as others need to know the yield of a crop or even the per person purchase average. Each industry is unique.
One of the things we do is help you work through this process – we set up a series of strategy calls to help you with not only the process but also the numbers and what obstacles may need to be addressed. Give us a call or go to our website to schedule time today to get started.