10 QUESTIONS TO HELP YOUR BUSINESS FLY
Gary Rouse | Director, CP Futures, Early Stage
1) Can your finance function operate at full capacity remotely?
More than ever, your business has to be able to operate remotely. It’s really important to ensure you are getting the right financial information quickly and efficiently, wherever you are, so that you can make informed business decisions. So, if you aren’t working remotely at full capacity, you need to review your finance function and ensure it’s working more efficiently.
2) Are you running multiple systems across your business that don’t talk to each other? Do you still carry out manual tasks as part of your systems?
If the answer is “yes” to either, then you may not be running your business as efficiently as you could be. Technology is playing a massive part in changing how every business is run, and fully integrated, automated systems can make a huge difference.
3) Are you preparing cashflow forecasts to help make key business decisions?
Covid has shown us how important cash is to running your business. Understanding the ebbs & flows of your future cash cycle has become even more vital. This means you need to ensure your finance function can quickly provide you with the information you need to understand this future cash cycle and what additional support you may need to maximise your opportunities.
4) Would more cash be helpful to the business, especially in the current environment?
R&D incentives claims can pay back up to 33.35% of qualifying spend, so it pays to ensure these are being considered fully and properly, claiming all that you’re due, whilst not falling foul of HMRC’s enquiring eye.
5) Do you need support from an adviser that can work with you to help drive your business forward?
Have you done this before? Do you need help in reducing costs? Do you need challenging – or a second opinion on how to ensure you have the right strategy? Do you want to ensure your senior team are aligned in your strategic thinking? Do you want help in raising finance?
You need to ensure you are working with the right business adviser that can help you deliver all of this, so take the time to weigh up your options and choose the right one. Then, you can focus on what you are good at – growing the business.
6) How do you ensure your team really can help you grow the business?
Whether it’s providing clarity on your vision and strategy, empathising with employees’ personal challenges, having a great environment to work in or providing incentives; having a truly engaged team has never been more important. Creating and building the right culture and having that at the forefront of everything you do is fundamental to ensuring your business is really working as one team.
7) Are you rewarding your key staff in a tax-efficient way?
During these challenging times, we’re seeing a number of businesses restructuring or considering changes to key employee remuneration. If not managed correctly, this can lead to a fall in employee engagement and retention just at a time when you need key staff to help ensure the business is on the right path. As such, a number of businesses are looking at ways to overcome these challenges. An employee share scheme is one example you can use as a cost effective way to ensure you retain and motivate key staff.
8) How are you dealing with the potential impact on your business of Brexit?
Brexit can impact not only the costs of your goods but – unless you can increase your sales price – your margin as well. Brexit could also impact your supply chain and where you should hold stock going forward. Therefore you need to ensure you have a strategy for minimising any potential impact on your business.
9) Have you thought about the tax impact of your overseas presence?
The world is more connected than ever, and a growing business can very quickly find that it is trading in multi-jurisdictions, dealing with the tax complexities that can flow from this. Spending time to ensure the business is compliant, whilst considering a structure that allows for tax-efficient cross-border trading, will ensure that the business’s cash tax position is carefully managed. This should allow for tax optimisation and, in some cases, tax cash through local tax reliefs such as R&D. A short term focus could yield long term tax efficiencies!
10) Are you considering selling your business in the next couple of years?
If you are, then you should be considering now what you need to do to maximise your exit value. Reviewing your systems and finance function to ensure it’s working super efficiently, is ready for the exit, and can provide accurate financial data quickly will give potential buyers much more confidence and help ensure they don’t try to chip your exit value. You should also consider early if there are any pre-sale tax planning opportunities to help maximise post tax returns.
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