2023 has been another challenging year for small businesses.
From rebounding sectors to new and exciting start-ups, it’s time to get your small business ready for what 2024 might bring.
Here are five key New Year’s resolutions for your small or medium-sized business to see you through.
How has 2023 been for small businesses?
There’s no doubt that 2023 has been challenging for small businesses.
One of the biggest issues has been the cost of living crisis and high inflation, which has impacted consumer spending.
While the Bank of England is getting high inflation under control after it fell more than expected in November 2023 following 14 base rate rises over two years, this has also led to soaring mortgage costs, impacting millions of people.
While starting a new business is an achievement in itself, much of the hard work still lies ahead
Around 20% of new businesses typically fail within a year, while 60% are expected to fail within their first three years.
Why do so many small businesses fail?
Starting a business is about taking risks, and while some of these risks will bring rewards, many won’t pay off.
There are some common pitfalls that many small and medium enterprises (SMEs) make that can compound their business troubles.
Some of the most common reasons for an SME failing are:
- Poor use of technology: If your business is struggling to adapt to the latest technological advances and you can’t provide the smooth user journey that customers expect, you could be losing out to your competitors.
- Supply chain problems: Supply chain disruption can be a major issue for UK businesses, and an inability to respond accordingly to these problems could be a major issue for your business.
- Security: Cybercrime has recently boomed and has become an increasing issue for businesses.
- Labour shortages: Another issue plaguing small businesses is the lack of the right skillsets among your team to drive a business forward, meaning recruitment should be a focus for the new year.
It’s vitally important for SMEs to have the right advice at the right time, so speaking to a financial adviser is always a good idea.
However, there are also some essential resolutions that SMEs could make to get off to a positive start in the new year.
Whether it’s offering your teams flexible or hybrid working, trying out new technology, or adjusting your supply chains, flexibility has quickly become a condition for business survival in the UK.
Particularly when it comes to the financial and legal implications of big business decisions, it is always a good idea to seek expert advice.
Also, having flexibility built into your business model will put it in great shape as you go into what could be a bumper year.
Focus on the wellbeing of your employees
Small businesses are only as healthy as their employees, so make the wellbeing of your team members one of your New Year business goals.
In the earliest stages of your SME growth, having an engaged, attentive and motivated workforce is one of the best ways you can run a steady and sustainable business.
Review your business plan and future goals
However your small business fared this year, it’s a safe bet that many business plans have been altered drastically since the pandemic.
Make a small business New Year’s resolution to set realistic goals. Review your business plan and consider the timelines and ambitions that your business is currently facing.
Consider the learnings from 2023 and challenges on the road ahead, and make sure these are taken into account when planning what you want to achieve in 2024.
Find the right talent
Major labour shortages are proving to be a persistent problem for many sectors in the UK.
You may need to reflect on any skills gaps in your team, whether your growth plans for the New Year could benefit from more hands or deck or if areas of the business might need to be restructured to improve efficiencies.
Whatever your New Year’s recruitment resolutions are, be prepared to present a competitive offering to attract and retain the best talent in 2024.
Bolster your online presence
Quite simply, if your business doesn’t rank on searches or is invisible on social media, your SME is going to struggle.
A significant and growing proportion of sales are now done online, so if the digital side of your business isn’t up to scratch, bolstering your online presence needs to be at the top of your small business New Year’s resolutions.
Running an SME isn’t easy, but your business can benefit from a trusted adviser to help you grow your business.
Whatever kind of expertise or support you need, you can find an adviser to match your needs on Unbiased.