Financial optimism is on the rise, but data shows that many small business owners are still trying to turn the corner.
In fact, according to Capital One’s Spark Small Business Barometer, while small businesses across the country are expressing optimism about the national economy and expect to see continued improvement in financial performance over the next six months, more than half (52 percent) say business conditions are only fair or poor.
So, what can small business owners do to help save money and get their shops “financially fit” heading into the holidays and prepare for a strong year in 2014? Here are some tips:
* Connect with your key business partners. Maintaining a strong relationship with your small business banker and other key business partners is crucial to achieving your business goals. Now is a great time to review your progress in 2013 and get aligned on your objectives for the new year.
* Be prepared. Start the new year off right by having a solid emergency plan in place. According to the Spark Small Business Barometer, only half of small business owners have a plan in place. Having a plan will help limit the financial and physical damage caused by an unexpected emergency or disaster.
* Recognize your employees with a retirement plan. According to the Spark Small Business Barometer, only 25 percent of small businesses offer a 401(k) plan. Now, ahead of the holiday season, is a great time to enable and encourage employees to plan for retirement and also recognize them for a job well done. You may qualify for special tax credits and if you had an especially strong year financially, consider profit sharing as a way to receive additional tax breaks and reward employees for a strong performance.
* Make charitable contributions and/or volunteer. Ahead of the holidays, consider donating money and/or usable items such as equipment, clothing and other goods as a smart way to claim a deduction for the items’ fair market value come tax time each business quarter. You can also plan an employee volunteer day to get your workforce into the spirit of giving for the holidays.
* Join (or renew) business associations or education programs. Association fees and business-related education are tax-deductible, as well as a good way to network, enhance workforce knowledge and recognize employee performance.
* When it comes to planning, utilize credit card programs that offer the added value of control mechanisms and reporting tools that support business planning and cash management. Also, make sure you enroll in a program that makes earning and redeeming rewards easy, with no: rewards expiration; limit on the amount of cash you can earn; redemption tiers; and the list goes on.
Preparing your business ahead of the holidays can go a long way toward setting it up for success in 2014.
For more helpful information on managing a small business, visit www.capitalonesmallbusiness.com. The Spark Small Business Barometer is a quarterly survey of small businesses across the nation that examines small business perceptions of the economy and gauges current financial conditions and business projections for the next six months.