Sales are up, but a few late customer payments can still make it difficult to cover payroll. Or perhaps an equipment purchase you put off this year will need to happen next year. Before the year ends, it’s important to take time to review where your business stands and what’s coming up.
For small businesses, agricultural operations, and established companies, this means looking at revenue, expenses, cash flow and banking needs. A thoughtful business banking strategy can help you manage seasonal expenses, build savings and anticipate potential financing needs.
Key Takeaways
- Review your business cash flow, expenses and seasonal changes.
- Make sure your checking and savings accounts support your current operations.
- Identify potential upcoming expenses before they become urgent.
- Use Digital Banking tools to monitor accounts and manage transactions.
- Set specific financial goals and discuss your plans with a business banker.
Why Your Business Banking Strategy Deserves an Annual Review
Your business may look very different today than it did a year ago. Maybe you have added employees, increased sales, purchased equipment, expanded operations or changed how you collect and pay money. Your banking strategy should keep pace.
Start by asking:- Has your transaction volume changed?
- Are you maintaining enough cash reserves?
- Do you expect major expenses in the coming year?
- Are you planning to hire, expand or purchase equipment?
- Could your business benefit from different account features or services?
- Will you pursue financing within the next 12 months?
The answers can help you set priorities for the year ahead.
Review Your Business's Financial Performance
Evaluate Cash Flow and Expenses: Business cash flow planning starts with timing. Compare when customer payments arrive with when bills come due, using the past year’s records.
Look for:- Payroll and employee-related costs
- Inventory and supplier payments
- Equipment and vehicle expenses
- Insurance and taxes
- Rent, utilities and other operating costs
- Outstanding receivables and payables
Identify Seasonal Financial Needs: Agricultural businesses may face expenses related to planting, livestock, equipment or other operational cycles. Retailers, contractors and other businesses may also experience periods of higher or lower revenue.
Identify months when expenses exceeded incoming cash. If you expect those gaps again, plan how savings or financing could help cover them.
Make Sure Your Business Bank Accounts Still Fit Your Needs
- Review Your Business Checking Account: Your checking account is at the center of your banking, so it should match your transaction volume and operations.
- Review transaction limits, fees, balance requirements and how you make payments. If your business has grown, a checking account that worked well when you started may no longer be the best option. Peoples Bank offers several business checking options to help you find an account that supports how you manage your finances.
- Build and Manage Business Savings: Your business savings strategy should account for both expected and unexpected expenses, including taxes, equipment purchases, seasonal costs and future growth.
A business savings account can help you set aside money, while keeping it separate from everyday spending. Peoples Bank offers business savings options to help you manage and grow those funds while keeping them accessible when necessary.
Plan Ahead for Financing & Growth
- Anticipate Upcoming Financing Needs: If you expect to purchase equipment, expand a facility, acquire property or make another significant investment, start thinking about financing before it becomes urgent. Estimate how much you may borrow, when you expect to use it and how the expense fits into your broader business plan.
- Review Existing Loans and Interest Rates: As you plan for the year ahead, take time to review any existing business loans, operating lines of credit or other financing obligations. Pay close attention to interest rates, payment schedules and whether any variable-rate loans are expected to adjust in the coming year.
- Prepare Your Financials Before You Need a Loan: If financing could be part of your plans for next year, review your financial records now. Make sure your income statements, balance sheets, tax documents and other relevant financial information are organized and current.
Strong financial records can make it easier to discuss your business with a lender and evaluate potential financing options. Peoples Bank also recommends preparing your business financials before pursuing growth-related borrowing.
Use Digital Banking Tools to Stay on Top of Your Finances
Digital Banking can make it easier to manage your finances throughout the year. Use Online & Mobile Banking to check balances, review transactions, transfer funds and set alerts for important account activity. Businesses can also take advantage of digital tools such as ACH and wire services, Bill Pay, Mobile Deposit and Tap2Local™ to streamline payments, improve cash flow and manage day-to-day banking more efficiently.
Taking advantage of these tools can help you keep a closer eye on your finances and make informed decisions as your business changes.
Learn More About Digital Banking
Set Financial Goals for the Year Ahead
Once you have reviewed your current financial position, turn that information into a short list of goals. Focus on the areas that matter most to your business and its plans for the coming year. Breaking larger goals into specific steps can make them easier to track and adjust.
- Build a cash reserve: Set a monthly savings target.
- Cut unnecessary costs: Review recurring expenses.
- Plan for major purchases: Decide what to save or finance.
- Improve cash flow: Review billing and payment timing.
- Plan for growth: Set goals for hiring, expansion or equipment.
- Review banking services: Make sure your accounts and tools support how you manage your finances.
Keep the goals specific and measurable. Set a date to review your progress each quarter so you can adjust your savings or spending plans if sales fall short or expenses rise.
Build Your Business Banking Strategy With Peoples Bank
A strong business financial planning process does not have to happen all at once. Start with your current financial picture, identify what is changing and consider what comes next for your business.
For businesses, a local banking team like Peoples Bank can help connect your plans with the right business banking solutions. Working with local businesses and agricultural operations means understanding their needs and providing services that support operations and long-term growth.
Ready to strengthen your business banking strategy? Contact a Peoples Bank business banker or visit a local bank location to review your banking setup and discuss next year’s goals.
