Posted Under: Accounting and Taxation Posted On 05/03/2021
So much was changing in 2020 due to Covid-19 that it was an unsettling time for business owners and employees alike. Self-funded retirees felt uncertainty as interest rates declined further and there was volatility in the share market. Students and parents alike were adjusting to periods of learning at home.
Talking to our clients, it seems that these changes gave cause to all to reflect on their business, employment/career, and their lives. Now in early 2021 many have simplified their life or started new careers or business opportunities. Others are retraining for new careers. Almost all have been re-evaluating what they want the next 5 years to look like, and what they need to do to get there.
Following are some ways that business owners have re-shaped their business and operations to take advantage of opportunities and improve profitability going forward.
Investing in Marketing
To survive and thrive going forward, getting online and being able to be found online is essential. Many businesses are going to the next level by getting a website, working on search engine optimisation (SEO) so they can be found online, social media marketing and remarketing, email marketing, click funnels and more. Because this is outside the experience and knowledge of business owners, they are outsourcing to specialists who can handle it for them.
Diversifying into New Product Lines or Services
2020 saw many business owners shift to embrace new opportunities or even survive. Examples are focussing on takeaways instead of customers dining in and manufacturers selling new hygiene and personal protection products. Also, businesses moving online like gyms, shows, seminars, conventions. Ingenious ideas include creating new product line opportunities and services that are more profitable for the business going forward.
Since many businesses have had to have staff work from home at some point in time during the last 12 months, they have become comfortable with the idea of offshoring, where once they would never have considered it. In addition, some industries and businesses have found hiring staff challenging, and so they have turned to offshoring services for one or more business functions. Services you can offshore include administration support, website design, social media marketing management, customer support and IT. Countries that are currently ‘popular’ with Australians are the Philippines and India. Some positives include cost savings for wages (can be 30% to 60% lower), they can handle mundane tasks, and you can keep down rents by not having to get more office space for new team members as your business grows. But you will need to consider time differences (the Philippines is only 2 hours difference) and social, cultural and communication barriers.
Getting on Top of Financial Matters
In order to move forward, in the direction you want, it will involve being on top of your financial matters. Personally, that may mean looking at more ways to earn more income, reducing your expenditures, putting aside a financial buffer (just in-case), paying off debt or even getting your life insurances and wills in place. At a business level it may mean getting an accountant you ‘click’ with so you can understand your financial position better, feeling that bookkeeping is ‘on point’ for your business, getting your paperwork (invoicing/payments) more organised, or making an appointment in March for tax planning for that financial year.
Perhaps you have done one or many of these strategies above. Whether you have or haven’t, keep looking for opportunities to grow and be more profitable in 2021 and beyond.