How Can Accountants Prepare for Tax Season?

It may only be September but we’re going to go there and mention the dreaded C word… no, not that one… Christmas! For the most festive of you out there this is bound to be a sight for sore eyes but for all those Ebenezer Scrooge’s amongst us, it’ll likely sending you recoiling in horror. But, bah humbug, in the world of business Christmas always come early and preparation for peak periods needs to start sooner rather than later so we’re here to offer our expert advice.

Here in Britain we are currently winding down from summer and using autumn to prepare for the peak winter period when the Christmas and New Year spirit means customers become a little more lax with the purse strings. The off-season down-time between now and then is the perfect opportunity for business owners to evaluate their company’s performance during the previous season, analyse financial accounts, train existing employees, hire new staff, develop services, restock products, and identify any gaps or new markets that need filling.

The following advice will be particularly pertinent for businesses that trade in seasonal services and products, such as children’s summer holiday entertainment and snow or ice removal. But even for a businesses which operate at maximum potential all year round, the transition between seasons is a crucial time to get right. We’ve pulled together a few top tips to take advantage of over the coming weeks to make sure you’re prepared in time for the peak festive period.

Make sure you’ve got staffing wrapped up

Last but certainly not least, the issue of staffing usually rears its head during peak periods and can be particularly challenging for small businesses which are commonly made up of five employees or less. You become stuck in the dilemma of needing more pairs of hands to cover the increased workload but not then being financially able to justify offering additional permanent positions after.

The best way to solve this catch-22 is to recruit temporary staff who are clear in the knowledge and understand transparently that the role is for a limited time only. This way you get the extra help you need and aren’t dealing with angry employees who were expecting a full-time job at the end of the season. This technique works particularly well for the retail, leisure and hospitality sectors but outsourcing to freelancers or offering your existing staff overtime during the peak period is an efficient way to work for others. (Make sure you organise this in good time to allow for the application and interview processes).

Readdress those pesky budgets

We hate to rain on the parade but when it comes to the run up to a peak period, it’s time to revisit your business budget plan and factor in for the various inevitable changes. For example, with a shift in seasons naturally comes a change in weather and here in good old Blighty it can get pretty chilly. This mean businesses across the country are likely to be spending more money on utilities like gas and electric over the coming months than they might have done during summer when it all it took was a few open windows to keep staff and customers at a satisfactory temperature.

If this increase in variable expenditure is something that is a particular concern to you, now might be a good time to measure and adjust your energy-based outgoings. E.ON has recently launched an online Energy Toolkit that enables businesses to analyse their energy consumption and then identify areas where they could potentially save some cash. Ian Walker, head of SME sales and marketing at E.ON explains (in a Guardian article) that, “through being able to monitor energy use, our customers can identify where they can cut wastage and save money.”

If you do decide to take on additional staff or offer existing employees overtime, this will also be a monetary factor that will need taking into serious consideration. As well as potentially adding to your army of employees in the fight against the festive frenzy, you will likely be looking to also increase your stock levels to meet the added customer demand. But on the bright side, don’t forget that peak seasons like Christmas (hopefully) mean increased revenue so when the storm has died down, you will be able to enjoy the fruits of your financial labour.

Andrew Subramaniam, small business partner at charted accountants, HW Fisher & Company advises in an article for the Guardian: “Ask for deposits on advance orders for seasonal products or services and arrange helpful but manageable credit lines if possible.”

Give your customers a little gift

Use the festive anticipation over the coming months to your advantage by devising a clever marketing campaign that you can launch ahead of the peak period and run throughout to gain brand exposure and give something back to your customers. Create your own version of the Starbucks Christmas drinks menu and create something that is a small change for you but packs a mean punch in customer engagement and interaction. If your business doesn’t naturally lend itself to something fun and festive then consider a promotional discount that you can advertise via social media to have the same effect.