KTM Solutions has a small tradition for our team huddle meetings: each week at the close of the meeting we announce how many days are left until Christmas. It’s one way we mark our way through the year together. And one thing we’ve found is that the countdown seems to move much more quickly at the end of the year then at the beginning until suddenly—this past Monday—Christmas was only 12 days away.
For those still doing their shopping it’s probably time to scramble.
In part because of the holiday season, the end of the year can sneak up on small-business owners too. We’ve found that the fourth quarter is a good time to start preparing for the holiday season and the close of the year.
Show Appreciation
Gratitude is always a good place to start. Recognizing the people who make your business possible is healthy both for business and for you. There are two groups that are especially important to thank:
Customers
If you work in an executive or administrative role, you’ve probably been receiving fliers about corporate gift baskets for a few months at this point. And while there’s nothing wrong with a gift basket or pieces of swag, you might be surprised how far a simple card can go when it’s sincere and personalized.
At the start of the holiday season, around Thanksgiving, take some time to send a note of thanks and appreciation to your customers, especially customers who have supported you loyally throughout the year. Let them know how much you value the relationship between your businesses.
Employees
Year end is busy for your company, so you can bet it’s busy for your employees, too. Many are likely facing busier family and personal schedules during November and December, or perhaps higher spending or tighter budgets than they do the rest of the year. This is the perfect time to show them how glad you are that out of all the employers they could work for, they chose you.
Company lunches and parties can strengthen rapport between employees and give them a chance to relax and enjoy themselves during the hectic year-end process. Bonuses that share profits from a strong year are a pleasant surprise and show that you value employees’ part in the company’s success.
Something else KTM Solutions has done when possible, factoring in project deadlines and workload, is to provide the scheduled business days between Christmas and New Year’s as additional paid holidays.
Regardless of which approach you choose for showing employee appreciation, communicating clearly and in advance lets employees plan their December budgets and travel schedules.
Prepare Your Business for Year-End Close
Year-end closeout and tax preparation of course continues past the holidays, into January and beyond. But taking steps in a few different areas before the end of December can help reduce stress around the holidays and in January.
Work schedules
Note which contracts require delivery by the end of the year. Delivery by 12/31 rather than after 1/1 can make all the difference in a client’s annual budget; errors here could hurt the business relationship.
Other scheduling factors to consider are employees’ holiday schedules and customers’ business closures. In our work with large OEM’s, KTM sometimes needs to plan product installations during a plant’s holiday shutdown, since the lines close down only a couple of times each year.
Cash flow and business plan
Depending on your YTD profit and your tax plan, you may want to adjust how you manage cash flow in the last couple of weeks of the year. If you’re trying to reduce your taxable income for the year, you might purchase some necessary equipment earlier than originally planned or pay some bills early. You could also delay invoicing for some contracts so that you don’t receive payment until the new year.
If your profit for the current year is low, you might invoice early to receive payment before the year ends. This approach can be worked out with specific customers, since some might want to pay early in order to keep the expense on their books for the current tax year.
Your accountant can advise you on whether any of the above steps would be helpful to you.
In addition to these cash flow steps, take a bit of time to plan your schedule for the first two or three weeks of January—what will you need to accomplish? It might be the last thing on your mind before the holidays and the close of the year, but having a tentative plan already laid out will make your return to work after the break much easier.
Plan—Then Enjoy the Holidays
We hope these tips can help you find structure in what often feels like a hectic time of year. They’ve made a big difference in how we navigate the holiday season at KTM Solutions. And most of all, we hope that a less stressful year end at work will let you enjoy the holidays to their fullest. Happy Holidays from all of us at KTM!