What Small Businesses Need to Know in 2017

Every year brings changes to rules, regulations, laws, and culture that will affect your business. Here are some interesting and exciting updates for 2017.

Review and analyze year-end financial statements — Tax-reporting time is right around the corner, so you should have year-end statements in your hands already. Don’t just push them over to your tax accountant, or set them aside after you pull off the compiled totals numbers for income-tax reporting. Use them. How do you do that? You (or your business adviser) analyze the revenues and expenses against your metrics and projections, and against ratio standards in your industry. 

Then make decisions about raising or lowering prices, making investments, acquiring additional financing, or cutting some spending to increase profitability. 

Listen to a startup podcast — Sipping a favorite drink while cooking an evening’s dinner in the kitchen is a perfect time to listen to a podcast, and StartUp (https://gimletmedia.com/startup/) from Gimlet Media is a great one. Each season is a little different, but highly recommended is Season 3 which focuses each episode on a company that is “stuck”. You can learn from actual case studies how founders managed to navigate big changes, even in some cases closing their companies.

Equity crowdfunding — Starting last May 16, 2016, regulation crowdfunding took effect — allowing non-accredited investors the ability to invest in startup securities for equity returns and ownership. Long-time crowdfunding sites like Indiegogo (https://equity.indiegogo.com) have jumped into the fray along with newcomers such as seedinvest (https://www.seedinvest.com). Startup investing is not just for venture capitalists and highly-connected angel investors any more.

Subscribe to Start-Up Digest Syracuse — Startup Digest — a project of Techstars, which also oversees the highly successful Startup Weekend series of events for startups across the country — is reigniting in Syracuse. Startup Digest is a “curated, personal, actionable guide for your entrepreneurial journey.” Anyone can subscribe for bi-weekly curation of events and happenings by visiting https://www.startupdigest.com/digests/syracuse.

Account for increasing costs — The price of a first-class stamp went up to 49 cents from 47 cents starting on Jan 22. The IRS mileage rate decreased from 54 to 53.5 cents per business mile, which might not have a large effect on most businesses. But if you’re in the transportation business, check out your cash-flow projections incorporating the change. The Federal Reserve recently raised the Federal Funds rate by a ¼ of a percentage point and indicated that it would likely raise rates two to three more times in 2017. So, work some varied projections into your analysis for this year. New York State minimum-wage changes went into effect on 

Dec. 31 at:

• 9.70 per hour for Upstate New York

• 10 per hour for Nassau, Suffolk, and Westchester counties

• 10.50 for New York City (small employers)

• 11 for New York City (large employers)

Be aware of legislative and regulatory changes — The new I-9 form went into effect on Jan. 17, required to be used for verifying the legality (https://www.uscis.gov/i-9) of all new employees. If you have owners, managers, and other high earners, the company may have higher payroll taxes this year as the base wage rate for FICA Social Security rose from $118,500 in 2016 to $127,200.   

Frank Cetera is a NYS-certified business advisor at the Small Business Development Center (SBDC) located at OCC.