Setting business goals may occasionally seem like a waste of time. Can’t you just take things day by day?
Well, sure, but then you let other people determine what your year looks like. That’s not exactly the best way to grow your business.
Planning out your year and identifying goals can help you determine where your business is headed, and ensure a more profitable future. Here are six tips to consider when setting business goals for 2018:
1. Gather the Numbers
You need to know how you did last year in order to set goals for this year. When gathering the numbers, you’ll want to look at more than just your sales figures. Consider profit and loss, number of new hires, number of people who quit (or were fired), insurance costs, office space rental costs, vendor fees and anything else that affects you financially.
2. Ask Yourself: Where Do You Want to Be in a Year?
Some might argue that you should only do this after you’ve completed your projections on what is possible—but you can’t make meaningful projections if you don’t know where you want to be. Do you want to grow? Do you want to remain stable? Do you want to cut back? It’s important to know the answers to these questions, so you can plan accordingly.
3. Ask Yourself: What Will It Take to Get There?
If you’re looking to grow your business, you may need to consider hiring new staff. If so, what skills would the new hires need? Is there room to get rid of non-productive staff? Yes, terminating is hard, but sometimes you have to do it for your business to move in the right direction. Are your current vendors the right vendors for 2018? What do you need to do more of? What do you need to do less of?
It can all seem overwhelming, so first ask yourself, what is your top priority? You need to do your budget now, that’s for sure, but what’s more important? Hiring new staff or vetting new vendors? It doesn’t all have to be done at once—so you should determine what needs to happen first.
4. Don’t Forget Your People
How many people can you expect to quit within the next year? If it’s been the same crew for 10 years, you can assume that there’s a good deal of stability. But if you’ve experienced a lot of turnover in the past, you can either expect more turnover in the future (which is normal for some types of businesses, like restaurants and retail) or you can work to improve retention by making changes in how you operate.
5. Pay Attention to Changing Laws
It’s important to consider how different changes (or decisions being made on a governmental level) might affect you, your employees and your business. These could include updates to certain tax rules and overtime regulations or health care costs. Confronting the possibilities now will help you feel prepared if any changes occur in the future.
6. Make Your Predictions
When asking yourself questions and making predictions, it’s important to be realistic. Where do you see your business in a year? If you hire a new salesperson, what’s a realistic expectation for growth in sales between last year and the coming year? Remember, there is a learning curve for every person you hire, and gaining new business is more difficult than maintaining your current business.
Are there any other factors that might affect your sales? Maybe a new competitor just opened up across town. If your business has national (or global) clients, remember that a competitor can come from anywhere. Is there anything going on externally that might cause an economic downturn or upturn? For instance, new business-friendly tax regulations could cause more companies to expand, leading to a burst in business.
When planning for the new year, don’t forget to involve your staff. Many of them will likely participate in the planning process, of course, but make sure everyone is aware of the company’s objectives. Setting business goals takes time and consideration, but in the end, you and your employees will have a road map for the future—and it’s always better to know where you’re going than to get lost along the way.