Ho Ho Humbug: The business realities of managing the Christmas season
The Christmas season affects different businesses in different ways and can have a significant impact on you.
For some, it is boom times but for others, a period of significant dislocation. Because of these differences, there is not a one size fits all answer to the best way to prepare and manage the season. You need to look at your business model and how the season affects your customers and suppliers. Armed with this information, what you need to be doing should be reasonably predictable.
Any period where operating conditions change means that there can be an impact on your profitability and cash flow. You need to look at both of these areas.
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Economic uncertainty means business needs to be more strategic
The coming 12 months promise a lot of volatility for business. Uncertainty around interest rates, the carbon tax debate, weak consumer sentiment and the possible ripple effect from problems overseas means that business will be working with a range of domestic and wider influences that will cause uncertainty. And this uncertainty will have upsides as well as problems for business.
Most SMEs are well downstream from major economic triggers. We don’t cause the problems but we are affected because of what is happening to larger business, the economy and consumers. Some industries are more impacted than others.
Expecting business in the coming year to be simply more of the same as in the past, is likely to be wishful thinking. If your business strategy is simply to turn up, work hard and expect business to come to you, then you are likely to be disappointed.
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Giving employees an interest
Q. I want to offer some of our key people an interest in the business. What are the issues and how should I go about it?
A. The first thing you need to determine is why you are doing this. Are you trying to tie them to the business, provide some recognition for them or is it part of a larger succession plan where you hope one day they may buy out your interest in the business? Understanding the reason is important because it may influence the arrangements you put in place.
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Getting your business structure right is important
Q. We have a well established business and own our business premises. Everything has operated in a single partnership structure. This has kept our accounting and reporting requirements quite simple. Friends keep telling me we should be looking at a different structure. Do you have any comments?
A. The choice of business structure is generally determined by a range of influences and there is no one answer that is right for all circumstances. The key issues to consider are risk protection, tax efficiency, simplicity and efficiency of management and succession. Using a single partnership structure you probably have the simplicity and efficiency of management piece covered. The issue to look at is whether the other areas are equally well managed or whether the benefits of alternate structures outweigh the cost of change.
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Free full day Business Development Workshop
Supporting Territory Business – Planning for better business, is a joint program offered by the Department of Business and Employment and the Northern Territory’s Business Enterprise Centre.
As part of the initiative, local business owners and operators are invited to attend a full day business development workshop, which is fully funded by the Northern Territory Government.
We invite you to join Hayes Knight Director, Alan Green, a respected leader in business development and strategic planning, who will be presenting the Business development workshop.
Attendees at the workshop will gain valuable insight and understanding into their financial statements and their relationship to business performance.
This opportunity should not be missed. Seats are limited to only one per business and will fill fast.
Business development workshop
When: Thursday 16th September 2010
Time: 8.30 am to 5.00 pm
Venue: Territory Business Centre, Peter Sitzler Building, 67 North Stuart Highway
Cost: Fully funded by the Northern Territory Government.
Lunch and refreshments will be provided.
Workshop content:
- understand the key elements of a successful business
- find out what profit and loss statements really tell you
- discover the power of the break even point
- identify the source and solutions for an underperforming business.
Register:
Contact Annalyn Mcleod on 8999 5421 or by email atannalyn.mcleod@nt.gov.au
Download:
Business Booster 2010-11 – Invitation to Business Development Workshop Alice Springs
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