Get your business receipts and invoices organized!
Yes, it is time to start planning your tax return.
To maximize your deductions, make your tax deductible donations before December 31st. If you plan to give a donation to an organization, now is the time to do it and get a possible reduction in your 2012 taxes. Use a credit card or check, the preferred way to donate, as you have a paper trail to document your financial gift. A cash gift cannot be documented unless you receive a receipt.
For those business owners who do the bookkeeping, start now to collect the receipts and invoices needed for completing your 2012 tax return. Analyze the information to determine how profitable your business was in 2012. Now you can plan for a more profitable 2013.
January 1st is not far away. This is when most people make their New Year’s resolutions for change. This is an excellent time to make those business changes that you believe will make more profit.
Reviewing sales invoices from 2012 will reveal how many sales (customers) you had as well as the revenue collected. Did you have more customer contacts in 2012 than in 2011? This information is key to knowing if the business is growing. How many new customers? How many returning customers? AN increase in revenue does NOT tell the whole story.
Did revenue per customer go up over 2011? Except for a price increase in your product or service, the goal should be for a larger average sale per customer from year to year.
Knowing the operating costs for 2012 indicates where operating changes may be needed, either to reduce or increase expenditures in a particular area of the operation. Knowing 2012 costs assists in deciding to hire more staff, let staff go, increase technology purchases. Each change requires a statement of outcome so that the change can be measured December, 2013, for impact and ongoing practice.
If you have no method for tracking sales or costs, contact SCORE for assistance in developing this business process. SCORE can be found in your local phone book and is a free service of the US Small Business Association.
The economy is growing. Markets are now generating revenue. A business plan with growth goals or stated revenue for 2013 can mean a more profitable business for you.
Get started……review those receipts and statements from 2012; analyze what they mean to you. Know where you have been so you can plan where to go next.