Blog: 3 best practice steps for taking your business to the next level
We know that business success doesn’t happen overnight.
It takes time to cultivate the right idea, find the right people and get the right funding, and even with all of that in place it’s often a case of one ‘step forwards, two steps back’ – especially in this ever-changing economic environment.
Patience is a key part of being a resilient business leader but there are other, more practical steps that can be taken to improve your chances of achieving your goals.
1. Make the most of failure
Some projects fly and some projects don’t, but failing in what you set out to achieve doesn’t necessarily mean all is lost!
Even those that don’t exceed initial budgets – 43% in fact – and so access to funding, particularly for IT businesses, is obviously a real challenge.
What many business owners don’t realise, however, is that success isn’t necessarily the deciding factor when it comes to accessing financial support.
Costs incurred in projects with an element of research and development, for example, can be claimed back from HMRC regardless of the outcome of that R&D or project.
Research and Development Tax Relief is a government incentive that allows forward-thinking businesses to claim back a proportion of R&D spend incurred as part of innovation – and the definition of innovation is also surprising.
For HMRC purposes, as long as a project has attempted to overcome a scientific or technological uncertainty a claim for R&D tax relief could still be made.
The incentive is designed to encourage businesses to innovate, and innovation is about approaching things differently, not about success or failure.
Successful claims are payable as a saving on Corporation Tax, a cash credit, or a direct cash rebate. The average claim value is £63,000.
Using an advisor to review your projects and process any claims makes it a relatively hassle-free option to explore – especially for loss-making businesses or those looking for a cash injection.
Of course, even outside of funding it’s important to take time to review why projects might not be deemed a success in order to build on the good, and avoid the bad next time.
2. Nail down your data
Data should help you make firm, informed decisions. Having too much can be just as big a problem as not having enough, so ask yourself whether you have what you need, and whether it’s aiding decision making or distracting you from it.
Financial data forms the foundation for most business decisions so if this isn’t in shape, that’s your priority.
There are practical reasons for keeping financial information in good order, too:
- if you want to make a claim for the aforementioned R&D tax relief, you’ll need project costings, statutory accounts and your latest CT600 to hand
- Making Tax Digital will require all businesses to eventually keep records and submit tax returns digitally, and you can’t do that if you’re not on top of this paperwork. If you’re working from paper resources or spreadsheets, it makes sense to find a tax and accountancy provider like MPA who use the latest and safest cloud-based technology, or to invest in MTD-compatible financial software solutions like Xero now
- Making sure your accounts are up to date and VAT returns are done on time will help you avoid late payment penalties, and mean you’re ready to go should you want to apply for government-based funding as many have over the last year
Don’t forget to non-financial include internal data in your review; are operational efficiencies clear, are projects being managed and analysed regularly, is your filing up to date, and can your team quickly share insight from all of the metrics they have access to.
If you’re not sure where to start, get in touch for a free business check and we can work out how to get you back on track, together.
3. Make structures flexible
There is no universal ‘best practice’ when it comes to structuring a business, but there are things good leaders do to protect their ventures from getting sunk by unpredictable challenges.
Knowing the strengths and weaknesses of your people and the best way to communicate with everyone, from top to bottom, is a great place to start.
If big changes happen, being a responsive communicator will reassure your team, while understanding what everyone in your business brings to the table will allow you to put the best resource in the right place, quickly.
Understanding your resourcing and assigning qualified deputies is all part of succession planning, which you should do even if you’re not looking to exit the business in the immediate future.
If you are looking to sell or transfer your business or shares, or make other significant changes to ownership status, our team of financial experts can help you prepare.
Whatever your version of success looks like, remember: be brave, be organised, be flexible and above all else, make the most of the opportunities given.
We’d love to get to know your business and take care of the mundane but necessary stuff like dealing with HMRC, leaving you with the time and headspace to innovate and move your business forward.Leave your details to start your journey with MPA