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The New Year Resolution Every Business Should Adopt

Believe it or not, New Year’s resolutions work equally well for businesses as they do for individuals. We highlight the one simple resolution to make this year as a business owner.

Take a good look at the key contracts that you rely on day to day, week to week. When did you last review these business relationships? If it’s been quite a while, then a simple resolution would be to look at them before the end of the month. You may be surprised to discover what they actually say, or more significantly, fail to say, and it is better to discover this now rather than when it’s too late.

Check if the contract is for a fixed term. If it is, has it already expired? You could be in a difficult area unless you act quickly and decisively. If not, diarise the expiry date and a suitable time to commence renewal negotiations. Even if the agreement has been in place for a while, you should consider whether it still offers you as much commercial advantage today as it did at the outset.

What does the contract state about price rises and charges? With pipeline price pressures showing no sign of easing, the supply chain is eager to pass this through, thus eroding margins for those failing or unable to pass these costs on.

Many business arrangements are not reduced to a written agreement but instead rely on long-term provisions. These are fine for so long as things are going well, but what happens when there are changes? For example, key managers can change, business strategy can shift direction or the company that you thought you were dealing with could be bought out.  Unless there is a proper written agreement in place, such changes leave you and your business vulnerable.

This exercise is equally important when considering your own customers. If you have standard terms and conditions of sale, take a look at the last time you last reviewed these. Any changes in the way you conduct or operate your business should be reflected in your standard terms. Similarly, terms should be reviewed for compliance with imminent legislative changes, with plenty on the 2018 horizon for commercial operators to reflect.

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