2019 seemed to fly by. Another year is in the books, and there is a lot to look forward to in 2020. As we close out the fourth quarter of 2019, construction business owners must prepare their operations for the New Year. Of course, the success of a business is largely contingent on preparation and foresight.
In this editorial, Tampa construction attorneys with Cotney Construction Law will discuss the most important items on the task sheet for business owners heading into the New Year. Remember, Cotney Construction Law is a construction industry advocate that’s here to grow and protect your business for the long haul. To learn more about our affordable subscription plans, consult a Tampa construction lawyer.
Manage These Fiscal Tasks
It should come as no surprise that the end of the year requires business owners to evaluate many of the financial aspects of their businesses. Here are some tasks that should be featured on your financial to-do list before January 2020:
1) Create a balance sheet to track your finances: this includes double-checking your assets (bank accounts, equipment, inventory), liabilities (credit and loan balances), depreciation, and total payroll for your workforce and vendors in 2019.
2) Perform a financial audit of your business: at the end of the day, it’s best to discover the warning signs of looming financial issues before they become a real problem.
3) Seek financial advice from a construction tax attorney: the Tampa construction lawyers at Cotney Construction Law can review any of your company’s financial statements, address potential deductions, and develop a financial outline for your tax deadlines for 2020. You may qualify for potential tax savings.
4) Consider converting your business: if you own a small business, you may want to consider converting your business from a sole proprietorship to a corporation or LLC. You can actually simplify your annual financial statements when you incorporate your business before the beginning of 2020. Regardless, a Tampa construction lawyer can advise you on the best fit for your business.
5) Develop a succession plan: some business owners will need to effectively transition their business to a new owner after they retire. Others may want to merge or acquire a business. Whatever your goal is for transitioning your business, a construction law firm can assist you with corporate transactions in 2020.
6) Consider starting a rainy day fund: if 2019 was a successful year for your business financially, it may be time to put some capital aside in a “cover your assets” forced saving account. With a potential recession looming within the next year or two, it’s important to reserve some capital to ensure that you have a rainy day fund in case your business experiences a setback.
Dot Your I’s and Cross Your T’s
Along with managing financial requirements, employers have a long list of additional objectives they should task themselves with completing during the holiday season. Here are a few projects to tackle before 2020:
1) Organize your documents: before the start of the fiscal year, employers should take the time to perform important recordkeeping tasks. This is the best time of year to purge irrelevant documents while creating a task sheet of the relevant documents you will need access to in 2020. Speak with an attorney from a St. Petersburg construction law firm to ensure that your recordkeeping is in good order for the New Year.
2) Review licenses and memberships: be sure to track eligibility requirements related to any licenses and additional credentials you will need next year. Consider any additional licensing you need to obtain for projects in 2020. If you are involved in any membership groups or associations related to your business, now is a good time to weigh the membership costs compared to your business’s bottom line.
3) Assess your contracts with clients and vendors: before you put pen to paper in 2020 on any new projects, partner with a Brandon construction lawyer to review your contracts. If there is any unclear language or inconsistencies, an experienced construction attorney can catch these issues and correct them before you enter a bad contract next year.
4) Evaluate your inventory: if projects are expected to launch in January, construction business owners need to assess all of their inventory to ensure they are ready to hit the ground running in 2020. This includes assessing any equipment, tools, vehicles, and leftover materials from past projects. This is the perfect time to weigh whether you should buy, lease, or rent additional equipment.
5) Consider future pricing for your jobs: depending on what type of construction work your business specializes in, the new year is also a great time to evaluate your profit margin from 2019 and consider how you should price jobs in 2020. In order to do this, you’ll need to determine an operating budget for 2020 along with projections for the year and create a markup price for your services in the upcoming year.
Don’t Lose Track of These Crucial Employment Responsibilities
As construction company employers have to combat a skilled labor gap and try their best to retain talent, here are a few important tasks to complete as you head into January 2020:
1) Conduct employee reviews: although quarterly reviews of your employees may be more effective, the end of the year is an important time to provide employee evaluations as well. Have an honest discussion regarding each team member’s performance, show an interest in their future plans at your company, and encourage your employees to be proactive about coming to you with any questions. This is also a great time to ask your supervisors to provide honest feedback regarding your own performance.
2) Update employee agreements: as you meet with employees for their evaluations, you need to document these conversations for recordkeeping purposes. This is also a great opportunity to ensure that everyone on your team is up-to-date with signing all of your agreements. This not only makes certain that all your employees are aware of company policy but also safeguards your company from future disputes with a disgruntled employee.
3) Assess the policies in your handbook: as your business grows, the employee handbook should grow with it. The end of the calendar year is a great time to sit down with a construction attorney and comb through your employee manual. You will want to add any employment policies that were missing from your handbook. At a minimum, this is a great time to have our St. Petersburg construction attorneys review your handbook.
4) Focus on training initiatives: similarly, the end of the year is the ideal time to review your company’s safety and training procedures. Do you need to update your safety manuals or conduct more safety training courses after the holidays? Perhaps you need to invest in more personal protection equipment (PPE) before the New Year? Remember, one of our Clearwater contractor lawyers can also perform a safety audit of your jobsites.
5) Consider hiring more employees: as you conduct employee reviews and assess your payroll, the end of December is a great time to consider your workforce options. Are there employees ready to move over to full-time? Are there vacant skilled positions that need to be filled? Before January, it’s a good time to draft up any job descriptions, review applications, and interview qualified applicants for any open positions.
6) Check workers’ comp coverage: perhaps the most important action item for employers related to their workforce is to ensure that every employee on their jobsites is covered with workers’ compensation insurance. Remember, if a single worker on your project isn’t covered, this can lead to a myriad of issues, including a stop-work order, ongoing fines, and a damaged reputation, among other problems.
Marketing Your Business for 2020
As you review your finances and profit margin at the end of the year, you will also want to consider your marketing strategy for 2020. This includes:
1) Create a marketing plan: whether you have an internal marketing team, invest in a marketing agency, or perform your own marketing services, you should assess the marketing sources you used for the past year and determine which services resulted in the most qualified leads for your business. Whether it’s a digital marketing strategy, in-person networking at events like trade shows, or referrals from existing clients and vendors, once you break down the numbers, you can begin to formulate a strategy of what marketing materials you want to invest in for 2020.
2) Invest in your website: regardless of where your qualified leads came from in 2019, one marketing item you never want to overlook is your company website. A professional website informs prospective clients of who you are, what you do, and can be the perfect closer for a sale. The end of the year offers employers the opportunity to review their website, determine if the web copy and services listed on the pages accurately reflect their business, and ensure that the contact forms lead where they should.
3) Spruce up your social media pages: similarly, a great New Year’s goal that can grow your business is to focus on beefing up your social media efforts in 2020. Do your Facebook, Instagram, and Twitter pages align with each other? Do they project a consistent brand? Do all of these pages have accurate contact information, like your company address and phone number? Establishing a social media strategy can set you apart from your competition in 2020. One last thing to consider: comb through these sites to ensure that all your content (copy, photos, videos) is in compliance with safety requirements.
Looking Back While Moving Forward
As you enter 2020, here are a few final pieces of advice from our Clearwater construction lawyers:
1) Don’t forget what got you here: although you may be eager to hit the ground running in January, take a moment to appreciate the people that got you where you are today. Thank your past clients for providing you with the opportunity to do what you do best. Who knows, it may even lead to a referral. Check in on your existing clients and make sure that they’re happy with your work. Chances are that, if you send a personalized message to your clients, they will appreciate it. Lastly, if your business profited from referrals, don’t forget to thank the clients, vendors, or employees that helped make your business more profitable.
2) Develop a Business Plan
Whether it’s a plan for the next year or a long-term plan, business owners that want to hit their objectives need to develop a comprehensive business plan. Employers need to assess everything within their organization, including their management process and financial projections. As your business evolves, your business plan should change along with these developments. Here are a few questions you can ask yourself:
- Is your business where you want it to be?
- Is the future looking bright?
- What do you hope to achieve in 2020?
- Is your management style working?
- Have there been any significant changes to your operation?
When you take time to perform a thorough review of your business, you can develop an effective strategy to utilize moving forward. Also, make sure that you write down any of your goals for this coming year, so you can review them at the start of 2021.
3) Appreciate what you’ve accomplished: between ongoing projects, change orders, the bid process, and a variety of other things, construction businesses don’t always have the time to reflect on their accomplishments; however, you should. Whether it’s celebrating your achievements with your team or remembering an important lesson related to a mistake you made, take some time to look back at your achievements and your failures before the New Year. It could make all the difference in 2020.
4) Invest in a subscription plan: many of the tasks within this end-of-the-year checklist can be accomplished when construction businesses invest in a legal subscription plan from a construction law firm. Whether your business needs assistance with contract review, employee handbook revisions, OSHA defense, or a variety of other helpful legal services, a subscription plan is a proactive way for you to save money on your legal spend, protect your business, and maintain access to our Brandon construction attorneys for whenever you need them.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.