Five ways for a more promising, productive and prosperous new business year
While we look forward to ushering in the Year of the Rat, it’s also an opportune time to review the year that was. Business operations don’t always go smoothly; successes are often balanced out by shortcomings and slip-ups. The good news is that these mistakes can be turned into learning opportunities if they’re recognised and assessed early on.
Here are five ways how SMEs can prepare for a more promising, productive and prosperous new business year.
- Set goals for the new year
Surely, you’ll want your business’ performance to exceed that of the previous year—whether in terms of profit levels, customer retention, sustainability, or other metrics. But this isn’t going to happen by itself, moreso if you don’t know what you are aiming for in the first place!
The first step is to set specific goals. What do you want your business to achieve in the new year? Think about:
- What is important to you and your business? For example, if you run an online publication that is funded by ad revenue, you may need to look at boosting your website traffic to keep advertisers happy.
- How can your goal be measured? Some goals aren’t immediately quantifiable, such making and keeping your business environmentally friendly. In these situations, you’ll need to dive deeper on how such goals can be measured. For example, if you run an F&B business, this could involve tracking the monthly amount of plastic waste generated.
- Review cash flow management processes
Cash flow is the lifeblood of any business. SMEs are no exception to this rule. In fact, they may be the ones that need to closely watch their cash flows.
As Ajit Raikar, co-founder and CEO of Validus Capital, shared in a MoneyFM 89.3 radio interview:
“SMEs are probably the last mile in the value chain, and therefore any slowdown in the economy affects them the most. So if there is a delay in payments from the large customers to the medium customers, and the medium to the small, guess who gets the wrong end of the stick? The SMEs.”
To maintain healthy cash flows, keep a close eye on your books and cut any business expenses that are unnecessary and drain your finances. At the same time, work towards keeping a sufficient cash buffer that you can tap on should payment delays occur.
- Upgrade to the latest technologies with the help of grants
Recognising that cash-strapped SMEs need a financial boost to improve their productivity, the government has rolled out various business grants to help with just that.
If you haven’t already heard of the following programs, it’s time to check them out (and think about submitting an application):
- SMEs Go Digital: This program’s Start Digital Pack allows SMEs new to using digital technology to adopt accounting, HR, cybersecurity, and other foundational digital solutions at no cost for the first six months.
- Productivity Support Grant: This grant provides up to 70% funding support for technological solutions and equipment that help improve business productivity.
- Automation Support Package: This package subsidises the large-scale deployment of automation solutions, ranging from up to 50% for qualified software and equipment costs and up to S$15 million in equipment loans.
- Leverage nascent business opportunities
Your existing suite of products and services may be serving your customers very well. However, that doesn’t mean they will continue to do so.
Seeing your success, competitors may be working on better alternatives to sway your customers to their side. Customer preferences may also change over time, causing the demand for your offerings to decrease.
What this means is that you can’t rest on your laurels. You have to be constantly on the lookout for nascent business opportunities to leverage so you can maintain your relevance to the market.
Keep your ear to the ground to identify the latest trends and upcoming technologies that you may be able to adopt for your business. If you don’t have the expertise to go at it alone, try partnering up with others who do in a mutually beneficial collaboration.
And if possible, conduct small-scale tests on the demand for your potential new offering before going “all in” on it.
- Plan on increasing employee productivity
Whether your business has five or 50 employees, labour costs are something that you can’t escape from. As a result, you’ll want to check whether you’re getting the highest productivity gains for your money.
For example, many menial and repetitive work tasks can now be outsourced to technological solutions. These solutions can often perform such tasks more quickly, affordably, and accurately than the average employee, so it simply makes no sense to continue getting your employees to do such work.
Instead, your employees can take on higher-value work that requires creative or complex problem-solving capabilities—capabilities that machines currently do not have. You may need to adjust the headcount of various departments or send your employees for training so they have the right skills for the job.
Also, take care of your employees’ welfare! Happy and motivated employees are generally more productive than disengaged ones, so consider implementing schemes to recognise their achievements and ensure they are finding satisfaction at work.
This new year, may fortune smile upon your business
As the saying goes, if you fail to plan, you plan to fail. To help your business succeed in the new year, it’s important to first draw up a plan for success and make adequate preparations for the year ahead.
While formulating your battle plan, you may realise that extra financial resources are needed to help your goals become a reality. If so, this is a good time to start seeking financing while your business is still in a strong financial position.