REVIEW your business sales, expenses, profit and bank balance -monthly at a minimum.
COMPARE the budgeted figures with the actual figures and analyse the variances.
MANAGE your business by changing your business plan if it is wrong and implementing strategies to improve your business bottom line.
QUESTIONS TO ASK YOURSELF:
- What value am I to my customers and can I add more value?
- Can I do it better, quicker or more efficiently?
- What other services can I offer?
- Who am I marketing my products and services too?
- Is this the right market for me or should I target another market?
- Are there any new products or services and can I offer?
Is it a Hobby or a Business?
A hobby is a spare-time activity or pastime pursued for pleasure or recreation; and
A business generally requires some form of investment and enough customers to whom its products or services can be sold on a consistent basis with a profit-making intention.
The distinction between a hobby and a business is important as the carrying on of a business requires a taxpayer to: declare sales income, claim tax deductible expenses, keep accurate records, register for an ABN and register for GST if turnover reaches $75,000 or more in the financial year.
If you are merely pursuing a hobby, you do not need to report the income from the hobby.
Go to my website for access to the Tax Office’s guide to determine whether your activity is a hobby or a business, or contact me for assistance.
Is your business viable?
Viability is defined as the ability to survive.
For a business, this is linked to financial performance and position.
A business is viable when either:
• It is returning a profit that is sufficient to provide a return to the business owner while also meeting its commitments to business creditors.
• It has sufficient cash resources to sustain itself through a period when it is not returning a profit.
If you are thinking of starting a business, it is important to do your market research, prepare a budget and forecast projections, as accurately as you can. If you are already in business, you have some figures to analyse to determine your business viability.
Please contact me for assistance.