8 Steps to Prepare Your Small Business for the New Year

Businesses have been through a lot over the last three years – and 2023 could be another challenging year. Inflation is high, new risks are emerging, and S&P Global says a recession is more likely than not. Yet among all of these challenges, there are opportunities. Businesses that are ready for the year ahead can find ways to thrive. To prepare your business for the new year, there are eight steps to take now.

1. Fine-tune your marketing plan.

As businesses create their 2023 budgets with a possible recession in mind, they might be tempted to cut marketing. A better strategy, though, could be to fine-tune your marketing plan. In fact, Nielsen points out that 75% of recessions end within a year, meaning spending cuts on marketing are usually short-term adjustments and therefore result in only small savings now, whereas they may make recovery after a recession more difficult.

During an economic downturn, your business has to work extra hard to make sales. Since you need to ensure every marketing dollar goes as far as possible, you need to focus on a cost-effective marketing strategy.

Run the numbers to determine where your best return on investment lies. This could be pay-per-click ads, email marketing, social media, blogging, or something else. Pay attention to your cost per lead. You may need to adjust your tactics to allocate more funds to your most cost-effective marketing channels.

2. Build your ecosystem.

There’s been a lot of well-deserved buzz about ecosystems recently. Consumers expect seamless, high-tech transactions, but many businesses can’t provide everything on their own. To succeed, they need to leverage strategic partnerships – which is another way of saying they need to build ecosystems.

According to McKinsey, 71% of consumers are ready for integrated ecosystem offerings. If you’re not providing this yet or if your ecosystem is underdeveloped, it’s time to catch up to meet consumer expectations.

3. Fortify your supply chains.

Don’t assume supply chain issues are a thing of the past. According to Bloomberg Law, political conflict, extreme weather, and economic troubles mean 2023 will likely involve supply chain disruptions.

If you depend on one supplier, you could be vulnerable to disruption, especially if that supplier is located far away. Learn from the pandemic and build resilient, flexible supply chains with multiple partners if possible.

4. Personalize your customer experience.

You provide a quality product or service – but what about the customer experience? According to research for Salesforce, this matters more than you might expect. A poll found that 88% of customers think a company’s experience is as important as its products or services. In many instances, this requires personalization. Salesforce also found that 73% of customers think companies should understand their unique needs and expectations.

If you’re not offering a personalized experience yet, 2023 is an excellent time to explore this possibility.

5. Automate where possible.

Personalized customer experiences are possible thanks to AI and automation. Automated systems can also help with other areas of business operations, such as inventory management. Plus, they can reduce human error and improve efficiency.

If you’re dealing with a limited staff, automation is an important way to reduce workloads, enabling your team to focus on tasks that need a human touch.

6. Strengthen your cybersecurity.

Ransomware, data breaches, and other cybersecurity risks should be on every business leader’s mind as we head into the new year. In 2022, cyber insurance rates surged in response to rising claims costs. In 2023, more sophisticated technology could give cybercriminals new weapons. For example, the Triple-I Blog warns that deepfakes could appear in phishing schemes to manipulate employees into handing over sensitive information.

To take control of this threat, businesses and insurers need to work together to prevent cyberattacks from occurring.

7. Invest in your people.

After enduring the frustrations of managing labor shortages, the Great Resignation, and quiet quitting, many employers are taking steps to strengthen their human infrastructure. They’re also bolstering their total compensation packages, with the goal of attracting and retaining top talent and slowing turnover cycles. A 2022 Salary.com survey found that one-quarter of employers plan to give raises of 5-7% in 2023 and 42.5% say their budgets for salary increases will be higher than last year. Likewise, a Mercer study found that employers expect medical plan costs per employee to rise 5.6% in 2023, compared to 3.2% in 2022.

While pay and benefits are important, strong talent management programs are also needed. If you haven’t taken a look at your hiring and training strategies lately, do so early in the year. Also, be sure to support your team’s mental wellbeing.

8. Take control of risk with a niche insurance partner.

A strong insurance program customized to the unique needs of your industry can help you manage both your risks and budget.

Heffernan Insurance Brokers offers tailor-made insurance packages for businesses. Our insurance professionals specialize in serving small businesses in different industries, including healthcare, food, hospitality, construction, cannabis, real estate, and nonprofits. We also offer specialty programs for education, security, janitorial services, and other industries.

Prepare your business for the new year with specialty insurance packages. Contact us.