Aside from a lot of eating and drinking, coming to the end of the year is a good time for reflection but also to look forward to the possibilities for the New Year ahead.
Most of us make resolutions with the best intentions of seeing them through but don’t always stick with them throughout the year. The influx of gym memberships at the start of the year and subsequent dropout rate gives some indication that keeping to our resolutions takes a high level of commitment and motivation.
While losing pounds off the waist is a popular resolution what about gaining pounds with your business? Forget about the gym membership for a moment and think about what resolutions you’re going to make to improve your business during the year ahead.
Develop a vision
Looking forward to the New Year ahead is a time where we typically make various resolutions in all aspects of our lives. It’s also a great opportunity to take stock of where you are and come up with grand vision of everything you want to do and achieve in the year ahead.
This is where you get to think big. Try create a pin board of what you want to achieve in 2018. It might be a personal goal like a holiday or new car, or it could be more business related such as hiring your first employee or developing a new product range.
Keep it old school and put some photos on your fridge door or head over to Pinterest and create a virtual vision board with images from across the web. However you create your pin board make sure it inspires and excites you towards realising your grand vision for the year ahead.
Do your research
If you are thinking of starting a business then you need to make sure that your idea is viable before leaping in with both feet. It may seem obvious but ask yourself these two simple questions before taking the plunge (and make sure you answer them honestly):
- Do you have the skills to make the product / offer the service and the motivation to get out of bed each day to do it?
- Does somebody want to buy what you are selling?
If you can answer ‘yes’ to both of these questions then it’s worth moving on and spending some time to do more market research and develop a business plan. Being honest about your level of motivation is critical as it can take a lot of time and effort to get a business off the ground.
If you haven’t done so already then this is the perfect time to set yourself targets for your business. Otherwise, how do you measure whether you’re heading in the right direction or not?
The targets you set for your business for the next year are up to you. They might be financial such as increasing turnover/profit, marketing related such as generating more enquiries or even helping social causes.
One way to create goals is to work backwards from where you want to end up. Remember that pin board we just created?
So if you need to make £30,000 then work out how many products or services you need to sell to achieve this.
For example, if you are selling your product for £30 but it costs you £10 in materials to make then that will leave you with £20 profit. In this case you would need to make 1,500 sales (generating £45,000 in turnover) to achieve that £30,000 in profit.
When setting goals, make sure that they are SMART. That means, specific, measurable, actionable, realistic and timed.
Specific: Try not to generalise. This is the time to think clearly about what you want to achieve.
“I want to generate sufficient profit to cover all my personal and business expenses. I therefore need to achieve a turnover of £45,000 and will do this by reducing my costs and increasing my market presence through a detailed marketing plan.”
Break this down into smaller targets that you know you can achieve but will all be working towards your main goal. You may need to replace or buy new machinery, take on another employee or outsource your social media.
Measurable: How are you going to know you have achieved this? Put a figure beside each target. For example, sell 40 products a week or increase the number of web enquiries by 8 a month.
Achievable: Make sure that you will be able to achieve any targets set. The goals you set should push you but not be unachievable.
If you need more finance but are already overstretched, look at other ways you may be able to achieve it which aren’t reliant on finance. Can you hire rather than buy? Can you open a trade account that will give you more time to pay for supplies? Can you do more yourself rather than outsourcing?
You certainly shouldn’t be pinning your hopes on a lottery win!
No one sets off on a marathon when they barely find the time to jog around the park. Maybe err on the side of caution. There’s no better feeling than overachieving.
Relevant: Think about whether the goals you are setting are realistic to the market conditions. If you know that there is a recession on the horizon then however much you would like to double your sales, it may not be a relevant to the current climate.
Also think about your customers and how they use your products. If you are B2B then maybe LinkedIn and a website presence is good for you. If all your customers find you on Facebook then widen your geographic reach or invest in Facebook advertising.
Timed: Goals should not be open-ended so make sure that you put a completion date beside each one. This will focus your mind and you will be more likely to achieve it.
With all of that in mind here is an example of a SMART target:
I will increase production in order to sell 80 products a month for the next 12 months up to December 2018. I will write copy content for my website and upload this twice a month in order to generate 8 new enquiries a month.
If you know the end goal you can then work on the plan to get there. An open ended vision is much harder to achieve and you are less likely to stay focussed on your target.
Monitor your progress
Once you’ve set your SMART goals then you need to know whether you are achieving them or not. Monitoring your actual progress against what you planned is very important. That way you can either reward yourself for making fantastic progress or make some changes if the results aren’t going the way you’d hoped.
This could be a simple as setting up a spreadsheet and updating the figures once a month or you could use technology to save you some time.
Most of us carry a smartphone with us all the time so now it’s really easy to access a range of apps to help you monitor your business. Finance apps such as QuickBooks can give you all your financial data at your fingertips so you can keep on top of your cash flow.
If you have a business website then Google Analytics is a great tool to track all your visitors as well as setting goals and conversions for transactions or enquiries. The information is comes straight from Google and the best part is it’s completely free to use by installing a bit of code on your website.
So if your New Year’s resolution is to achieve the turnover, reduce that workload and keep your customers happy so that you can work from that remote Fijian Island you can have all the tools to do so.
Take time to reflect
You may already be achieving maximum turnover but does that give you maximum profit?
Sometimes looking at business expenditure can cut those pounds. We are inundated with price comparison websites but have you looked at your business insurance since you first took it out? How about leasing rather than buying equipment?
Also, think about how you are spending your time and whether you are making the best use of your own skills. Letting others take care of time-consuming tasks such as bookkeeping or admin could be a better way of managing your own time more efficiently and concentrating on more important aspects of your business.
Like anything worth doing in life, a good business requires work and dedication but can be incredibly rewarding. Hopefully this has given you some ideas to apply to your business in the year ahead or given you the motivation to start that business you’ve always dreamed about.
Do you have any other New Year’s resolutions for your business?