10 Year End Planning Tasks for Small Businesses

Essential December Tasks Small Businesses Need to Know

2024 is almost over. December is the time of year for solopreneurs and small business owners to reflect on their accomplishments, assess their challenges, and lay the groundwork to set the stage for future growth. But December also tends to be a busy month wrapping up client projects, marketing to new clients, and signing contracts for work beginning in January.

December is already stressful for many people. It’s can be even worse for small business owners who haven’t taken the time to do year end planning before calendar Quarter 4 started.

Stop here before you continue on. Then pause for a moment and take a deep breath. Sometimes just reading about everything that needs to be done can create stress. This post provides a framework. Plus we’re here to help. All you need to do is reach out and ask!

Top 10 Year End Planning Tasks

There are a lot of year end planning tasks that could and should be done. Let’s focus on 10 of the essential tasks to complete this month, along with insights on what can be done in-house and what might be best outsourced.

• • Review Financial Statements and Close the Books
    Gather all financial records, including income statements, balance sheets, and cash flow statements. Ensure all transactions are recorded and reconciled to provide a clear picture of your business’s financial health as you prepare for tax season. If you don’t use accounting software, this is a great time to purchase one so it can be set up before January. We recommend QuickBooks Online. It’s perfect for most businesses, and since it’s cloud based, it can be accessed from almost anywhere.
  • Analyze Cash Flow and Prepare Key Financial Reports
    Examine your cash inflows and outflows throughout the year. Identify patterns and areas for improvement, then prepare reports that will guide your financial decisions in the coming year. Cash flow is an important indicator of your company’s financial health…even more than revenue. Cash flow issues are one of the main reasons that companies fail.
  • Conduct a Year-End Performance Review
    Assess your business’s performance against the goals set at the beginning of the year. Then identify what worked well and what didn’t. Use these insights as you create your strategy for the upcoming year.
  • Set Goals and Priorities for the Upcoming Year
    Based on your performance review, set SMART (Specific, Measurable, Achievable, Relevant, Time-bound) goals for the new year. Prioritize these goals and create actionable plans to achieve them. If you didn’t set specific goals for the current year, then the info learned in the year end performance review can provide baseline information so you can create realistic and achievable goals.
  • Evaluate and Update Vendor Information
    Review your list of suppliers and service providers. Make sure to update contact information, reassess contract terms and conditions, and consider negotiating better deals. You can also remove while removing inactive vendors from your system or keep them but mark them as inactive. We recommend the latter as it provides a history of who you previously engaged.
  • Reconcile Accounts Receivable and Payable
    Ensure all appropriate outstanding invoices are paid and all debts are collected. This maintains good relationships with your suppliers and helps with cash flow. Keep in mind that some customers may push off December payments into January. It’s important to monitor your accounts receivable aging; and it’s really important to stay in contact with the customer’s accounts payable department if an invoice payment is late.
  • Assess Inventory and Equipment
    If this is applicable to your business, you should conduct a physical count of inventory and evaluate the condition of it. Identify items that need restocking, repairing, or replacing. This will help with budgeting and tax preparation.
  • Review and Update Business Processes and Systems
    Evaluate your current workflows and technologies. Identify inefficiencies and areas for improvement, considering new tools or processes to boost productivity in the coming year.
  • Strengthen Client and Network Relationships
    Reach out to key clients, partners, and industry contacts with holiday greetings or thank-you notes. This helps maintain valuable business relationships that can lead to future opportunities. If you send a holiday card, handwrite the address. It may take a little longer, but it’s more personal. If you don’t have great handwriting, you can hire a calligrapher to address the envelopes. And use a pen to sign the card — pre-printed signatures can be cheesy.
  • Prepare for Tax Season
    December is a great time to start gathering all necessary documents for tax filing while reviewing potential deductions and credits. If you haven’t been doing it during the year, consider consulting with a tax professional prior to “tax season” starting. This can ensure compliance and maximize benefits. <= This is a great reminder that tax planning isn’t just the few months of tax season. Businesses should meet at least quarterly with their tax professional to ensure no surprises when the company’s taxes are prepared.

Year End Planning Tasks to Do In-House

Depending on the business’s capabilities, the year end planning tasks included below are ideal for in-house completion. This is because they require an intimate knowledge of your business operations, or it involves strategic decision-making that reflects your unique vision. Handling these tasks internally can create a deeper understanding of your business’s position while cultivating a sense of ownership in planning for the future or as we say Planning for the “What If”®.

• • Review past year’s wins: Celebrate your achievements and analyze what led to your successes.
  • Conduct a SWOT analysis: Identify your business’s strengths, weaknesses, opportunities, and threats to inform your strategy.
  • Set annual goals: Establish clear, measurable objectives for the coming year, broken down by quarter.
  • Analyze popular products/services: Determine which offerings are most profitable and why customers prefer them.
  • Update vendor information: Ensure your supplier database is current and relationships are in good standing.
  • Send holiday greetings: Strengthen client relationships with personalized messages or small tokens of appreciation.
  • Reflect on personal growth: Assess your own development as a business owner and set personal goals for the future.

Year End Planning Tasks to Consider Outsourcing

Outsourcing some or all of your year end planning tasks can save you time while ensuring accuracy through specialized expertise. The activities included below are often complex or time-consuming but at the same time are critical to your business’s success. For small businesses, time is money. The ROI of having more time to find new customers or deliver products/services can outweigh the cost of outsourcing these activities.

• • Finalizing financial statements: Have a professional accountant prepare and review your year-end financial documents. This is especially important if you’re looking for bank financing for your company.
  • Preparing taxes: Engage a tax expert to ensure compliance and maximize deductions. This is what they do every day, and they’ll have a better understanding of the tax code and allowable deductions.
  • Counting inventory: Hire a third-party service for an unbiased and accurate inventory assessment. Spend your time on activities that generate revenue.
  • Developing marketing strategies: Consult with marketing professionals to create a comprehensive plan for the new year. Ask them to brainstorm ideas to grow or expand your business into new/related areas.
  • Conducting legal compliance checks: Have a lawyer review your business practices to ensure the company meets all regulatory requirements. If you have employees, do the same with an employment attorney.
  • Conducting cybersecurity audits: Engage IT specialists to assess and fortify your digital security measures. Cybersecurity is a weak area for a lot of companies. Addressing this before there is a problem is important, and it will add a layer of protection to client, company and employee data.

The Pitfalls of Neglecting Year End Planning Tasks

Failing to complete these crucial year end planning tasks tasks in December can potentially have serious consequences for your business. The upside is some of the tasks can be done or started before December. Use this as a reference list and create calendar reminders so you aren’t scrambling to get the tasks done at the end of the year.

• • Financial oversights: Without a thorough review of your finances, you might miss critical insights into your company’s financial health. This can lead to poor decision-making and to cash flow problems.
  • Tax troubles: Neglecting tax preparation can result in rushed filings, missed deductions, or even costly audits. The lack of accounting software contributes to these issues and also means that accounting entries aren’t done throughout the year.
  • Missed opportunities: Failing to set clear goals and strategies may cause you to overlook potential growth areas or fall behind competitors. It can also mean that the company is responding to whatever business walks through the door instead of only accepting clients and customers that are aligned with the company’s goals.
  • Relationship strain: Not reaching out to clients and partners during the holiday season could weaken valuable business relationships. It doesn’t have to be fancy or doesn’t have to be expensive. A quick call or personalized email works. Make sure emails are individually addressed. Do not send an email to yourself with people as BCCs and don’t make it generic. All this says is “I didn’t invest the time in doing this.” And seriously – ensure the person’s name is associated with the email address. Don’t send a message to George that starts “Hi Tim!”
  • Legal and compliance risks: Overlooking legal and regulatory updates could expose your business to fines or legal issues. This should be done at least quarterly and when there are changes to any laws in your industry.
  • Operational inefficiencies: Postponing process reviews and updates may perpetuate inefficiencies, hindering productivity in the new year. We feel very strongly about this and it’s one of many areas that Tripod Coaching & Consulting® excels.
  • Cash flow problems: Without proper accounts reconciliation and financial planning, you might face unexpected cash flow issues in the coming months. Lack of cash flow means you can’t pay yourself, your employees and/or your subcontractors and vendors.
  • Inventory mismanagement: Skipping inventory assessments could lead to stockouts or overstocking, affecting your bottom line. This is especially important if you’re in an industry that is facing supply chain issues – and most industries are facing this.
  • Security vulnerabilities: Neglecting cybersecurity reviews may leave your business exposed to data breaches or cyber attacks. This is costly not only from a financial and legal standpoint, but it can also create irreparable damage to the company’s reputation.
  • Missed tax savings: Failing to make strategic year-end purchases or donations could result in higher tax liabilities. This goes back to having a solid finance and accounting infrastructure. It is all but impossible to make purchase or donation decisions if you don’t know how much you need to spend to offset the tax liabilities.

December activities can be the foundation for a successful year

December is not just about celebrating the end of another year. It’s also about laying a solid foundation for future success. We like to say that a strong foundation = a solid company. By completing these essential year end planning tasks — whether in-house or outsourced — you can lay the foundation for your small business to be well-prepared for whatever challenges lie ahead in the new year. We have a lot of tips on ways to optimize your business processes, and we can help with the decision-making on what makes sense to outsource! Let’s make 2025 your best year yet!

Need help with next steps or have questions about this topic?

We know that a lot of business struggle with their year end planning and tasks, particularly with accounting and finance functions. This means that this part of the business is “put off until later” because the company doesn’t have the ability to handle these activities.

That’s where Tripod Coaching & Consulting LLC® can help and fill the year end planning gap for small businesses. Check out our services page for details about what we offer.

If you need to egage us for ongoing or project-based support, or if have any questions about our services, please reach out via the contact page. We can set up a call to talk and we’ll then develop a strategy based on our initial conversation.

We’re also happy to answer questions about this post. Reach out on the contact page, and include the blog post name or URL, as well as the question(s) you have.