by: Amanda Bertholf
5 WAYS TO PLAN FOR THE YEAR END
As the year winds down and business starts to lull, you may be tempted to take it easy. But do you know how your business is doing? This is a great time to review the past year and do some planning for the next—take stock and decide where the New Year will take you. Here are some tested tactics from the U.S. Small Business Administration that you can use to review your business’ performance.
1. Focus on your accomplishments
Review what your business has done well—it’s too easy to let the low points stay with us, so be sure to celebrate the high points. Remind yourself of your successes and think about ways to repeat them. Then take stock of key areas of your business including core activities, marketing, employees, and business finances.
2. Assess core activities (what you do and who your market is)
Core activities encompass your business operations. Areas to assess include your core products and services as well as your client base. Ask yourself questions such as:
• Which products or services are the most profitable? How can you optimize operations around the success of these?
• Are any products or services that are failing? Are there any changes you can make to enhance their sales or profitability (marketing, price, and so on)?
• Are your services still aligned with your target market? Has your core client base changed in the past year? What market forces impact your client base? You may need to go back to the drawing board and assess what your customer’s needs are.
• What do your customers think of you? How customer-centric is your approach to business? Successful businesses watch the customer, become the customer, and involve the customer.
3. Conduct a sales and marketing review
In addition to measuring your sales performance and marketing ROI against your objectives and business plan, a full sales and marketing review should also include an analysis of market forces and the benchmarking of your business against the competition—an efficient way to do this is to conduct a SWOT analysis.
4. Evaluate your team
Annual performance reviews are traditionally something that bosses and employees tend to dislike or dread. But a well-prepared and honest performance review is an invaluable way to base line employee performance, strengths and weaknesses, recognize achievement, and ensure that individual goals are aligned with overall business goals.
5. Review your business’ finances
Every business is different so it’s worth talking to your accountant about your individual circumstances, but as a guide you will need to review:
• Budget: Do you have one and are you sticking to it?
• Cash flow: Is it sufficient? Can you forecast cash flow trends so that you can anticipate problems and prepare for them in advance? Do you need and have a contingency plan?
• Profit: What is the state of your gross profit margin?
• Cost base and pricing: Constantly review your cost base. Do you need to adjust pricing? How will this impact your client relationships?
• Borrowing: Are you staying on top of your business loan or overdraft obligations? Should you explore options for refinancing?
Taxes: Get a step ahead of tax season pressures now to help maximize your deductions and sail through tax season.