I recently saw a cartoon with a child asking his mother: “What are new year’s resolutions?” The maternal tongue-in-cheek reply was: “A to-do list for the month of January.”
Many quips are made about the ineffectiveness new year’s resolutions, but research has shown that the start of a new year actually does create a platform for change. According to a spate of studies, a new year creates a catalyst for self-improvement activities. Google searches for words such as diet, gym attendance and exercise peak in January.
“Researchers doing the studies call it the “fresh start effect” – the idea that particular days and dates serve as temporal landmarks, much like physical landmarks serve as demarcations of important places,” writes Lisa Williams for The Conversation. “In the case of temporal landmarks, the demarcation is between a past self, who has perhaps failed to meet goals, and the present self, who has goal pursuit at their fingertips.”
It makes sense then, that we plan for a successful business year in January as well. It’s a time to change the current way of doing things, set goals and aim for improvements. But, just as with your new year’s resolutions, these can either remain a list of wishes or become an action plan for the year ahead. There is a way of ensuring the latter takes place. We recommend bringing on a contract accountant for this period of time. Here’s how the input of a contract accountant can help make the planning process a success.
A contract accountant can help you forecast accurately
Setting goals that are unrealistic is both demotivating and counter-productive. If you currently weigh 95 kilograms, it would be wiser to aim to lose 15 kilograms in a year rather than 30. Your contract accountant will help you know how much your business “weighs” upfront in order to know what goals to set. They’ll help give you a sense of where you’re at and what you can realistically aim for.
A contract accountant can help you budget realistically
If you’ve set a weight loss goal, your next step would be to determine how to go about achieving it. You’d set goals for exercise and goals to eat a certain number of calories daily, or to cut out excess carbs and sugar. Similarly, your contract accountant will help you know where to allocate your resources in order to achieve your profit and margin goals. They’ll help you decide what to spend on sales and marketing and how to much to inject into new capital.
A contract accountant will help guide your decision-making
A trained finance professional, for example, can perform a cost analysis for a product that you’ve been manufacturing over the last year. This will help you determine whether you’ve pitched your product at the right price or should go higher or lower. Your contract accountant should give you a sound basis on which to choose a direction, and the confidence to do so.
As you look for a fresh start in your company this year, consider bringing on a contract accountant to help you plan for it. Contact The Finance Team to find out how one of our associates can help you plan, budget and make decisions that will give you the fresh start you’ve been looking for in 2016.