Are Taxes And Cash Flow Your Biggest Worries in 2018?
As January ends, Capital One’s Small Business Growth Index has discovered that America’s small business owners have some concerns about their prospects for the year, especially when it comes to taxes and cash flow.
The good news is that overall, small business owners have positive feelings about their finances, with 47% saying that their businesses’ sales increased in the previous six months—the highest percentage recorded by the survey since Q2 2013. And 37% responded that their financial position is better than it was a year ago. However, that’s not to say that small business owners are feeling overly confident. They still have several concerns, many of which pertain to money.
Let’s examine some of the issues that are worrying small business owners and some potential solutions.
Taxes are the Biggest Concern for Small Business Owners
Taxes were cited by nearly half (45%) of small business owners in the survey as a significant source of uneasiness for 2018, with 30% responding that tax laws had a negative effect on their business last year.
It’s not a surprise that taxes would be at or near the top of any list of small business headaches because they’re a common issue for all business owners. One thing that’s of concern is the impact of the new tax legislation passed late last year. Many small business owners are uncertain about how taxes will impact them in 2018.
To alleviate this concern, work with an experienced CPA or accountant who specializes in helping small businesses in your industry. He or she can be invaluable to be certain that you’re getting all the tax breaks you deserve. Enlist their help early in the year so you can heed their advice on any changes you may need to make this year to reduce your tax burden.
Cash Flow Also a Worry
Number Two on the survey of concerns for small business owners is managing their cash flow. Roughly 42% of the respondents said that this issue is challenging. This response is an increase of 11% from last year’s survey. This means that although small business owners are currently managing their cash well, they’re unsure that they can continue to do so.
If this is a concern for your small business, begin by monitoring your cash flow. It’s not unusual for business owners to not give their cash situation attention until it’s too late. If you’re in an industry with thin margins or slow-paying customers—or if you have a seasonal business—it’s imperative to be vigilant of your cash flow every week or even daily.
Make efforts to speed up payments from customers and try to delay your own payables to have more cash on hand. See these 19 strategies to improve cash flow.
As a small business owner, you’re responsible for every facet of your company. And it’s no surprise that 32% of entrepreneurs in the survey cited “keeping up with technology” as a big challenge—an uptick of 7% from the same time in 2017. New technologies like artificial intelligence (AI), voice-activated assistants (e.g., Apple’s Siri and Amazon Alexa), and chatbots (like Google Assistant) are permeating the small business market… which makes keeping up overwhelming. With companies of all sizes and in all industries increasingly investing in advertising, marketing, and selling online, it’s critical for you to stay to be up-to-date on what technology can do for your company.
For those who are concerned about technology, experts like Andrew Rogerson in Sacramento suggest that you find a reliable industry publication or website that discusses technology as it relates to your specific industry. Look at this resource frequently to be aware of technology trends and to have a heads-up on changes that could impact your company. It may also be wise to work with an IT consultant to assess your company’s current tech situation who can provide you with suggestions for upgrades.
An additional technology point: the survey found that more than one-third (36%) of business owners in the survey don’t have a website. Now that’s an easy fix with an abundance of professional and DIY website programs on the market.
Contact a Business Expert
It’s common for small business owners to worry about the future. But luckily you can take some decisive actions to be better prepared this year. To sum it all up the most frequent worries for small business owners in 2018 are definitely taxes and cash flow.
Andrew Rogerson serves business and franchise owners, as well as those looking to purchase a business or franchise throughout Southern California and Northern California including areas like San Diego and Orange Counties, the Los Angeles metro area, the California Central Valley, San Francisco Bay Area, Sacramento County, Coastal California, and the Sierra Nevada. He’s an expert in dealing with taxes and cash flow problems and questions.
If you have questions about business opportunities in and around Sacramento, Andrew can help answer your questions. Take some time to speak with Andrew about business transactions or visit our website. Contact Andrew via email or call him at (916) 570-2674.