February 23, 2024
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Guest commentary: How small business owners can prepare for 2024

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By Kristi Alameda

As 2023 comes to a close, it’s always a good time for business owners to use the final weeks of the year to reflect on the state of their business and the factors that matter most to their success. 

This is a great starting point to hit the ground running strong in January.

The most successful companies will be those with leaders who are keenly versed in knowing cost structures, focused on core competencies and understand the market. 

These fundamental skill sets can equate to successful bottom lines, regardless of your specific industry or economic conditions. 

As for economic conditions, while Bank of America Global Research economists expect consumption to slow down, they also anticipate disinflation to continue and rate cuts to begin midway through 2024, calling for a ‘soft landing’ of the economy rather than a recession.

Given this, here are a few steps that business leaders can take going into the new year.

Updating your business plan

Regularly reviewing and adapting your business plan is critical to ensure you’re operating in a realistic and nimble manner. When updating a business plan, there are a few best practices to keep in mind. 

• Compare this year’s business performance to previous years. You can do this by checking sales results and marketing tactics to spot trends. This will help you determine the best strategies for next year. 

• Keep your budget in mind and ensure you are updating salaries, your projections, and any fixed costs or money you’ve used to grow your business over the past year. Update cash flow projections, fixed costs, salaries, or any money you use for operations and growth.

• Source feedback from others when updating your business plan. Speak with your employees, your customers and fellow business owners to get a sense of what’s working well and what needs to be changed in order to perform better in 2024.

• Evaluate your customer service offerings. At the end of the day, you want to make sure you’re keeping the customer happy, so look at strategies, such as loyalty programs, to ensure you’re creating repeat customers. 

Evaluate your working capital

One resource that almost all business owners will need is capital — be it from efficiencies and cost reductions or from your bank or the SBA. In the Tri-Counties, Bank of America small business lending is up year-over-year, currently with $180 million extended locally, reflecting confidence and growth amongst Central Coast small businesses. 

Despite the need, many entrepreneurs face difficulties accessing capital. 

Traditional bank loans may feel like the strongest capital source, but it’s important to consider that might not be the best fit for your business. This is where business grants that do not need to be repaid can help bolster your small business finances. 

Also, Community Development Financial Institutions (CDFIs) such as Women’s Economic Ventures and California Coastal Rural Development Corporation and microlenders such as Pacific Community Ventures, INC and Access Plus Capital can be helpful sources of lower-cost capital helping underserved entrepreneurs. 

Bank of America’s Access to Capital Directory also offers a variety of free and low-cost capital resources to consider.

Recruiting and retaining talent 

Many small businesses continue to have staffing challenges — especially in markets like the Central Coast with high costs of living. It is important to re-evaluate your hiring or retention processes. 

Whether it’s sourcing candidates through different methods, setting a clear employee pipeline and growth timeline, or creating an internship program, entrepreneurs can explore various ways to bring candidates to the interview table. 

As the “war for talent” continues, our bankers have also been working with more businesses to offer benefits packages as additional ways to recruit and retain top talent. 

The end of the year is also the ideal time to recognize your current team. If you’re able, go out of your way to provide a token of appreciation. 

This could be as significant as a holiday bonus, or as simple as a personal thank you card. 

Celebrate the wins

Finally, take the time to celebrate your own accomplishments. Operating a small business has become more complex recently, so it’s important to focus on the lessons you’ve learned from another year in business. Be proud of yourself — you deserve it!

As the nation’s top small business lender that has served the Central Coast for more than 100 years, Bank of America is proud to offer these steps that can help put your business on the path to a strong and successful 2024.

Kristi Alameda is Bank of America’s senior vice president for small business banking in the Tri-Counties.