Whether you’re starting a new company or growing an existing company, you must juggle many tasks.
You can defer some tasks until later, but there are a few tasks you should prioritize immediately. For example, you should establish your overall business goals for the next twelve months.
The Small Business Administration reports that 32.5 million small businesses in the United States have approximately 61.2 million employees.
There’s a lot of competition vying for people’s attention. You’ll have to work hard to break through the noise.
Annual goals can serve to take your business to the next level and move you closer to your long-term goals.
However, you can’t just pick a few random goals and expect them to help you grow your business. If you want to achieve specific benchmarks, you must be strategic with writing out your plans and setting goals for the next twelve months.
If you wrote a business plan for your business, you’re already a few steps ahead of competitors. A well-written business plan outlines some of your long-term goals and should be the first thing you turn to as you plan out your S.M.A.R.T. goals for the year.
What Is a S.M.A.R.T. Goal?
S.M.A.R.T. is an acronym showing the way to set and achieve goals. The letters stand for:
Specific – What area is the target? Narrow it down.
Measurable – How will you measure success? What quantifies it?
Assigned – Who will achieve the goal?
Realistic – Make sure the goal is attainable.
Time – What is the deadline to achieve the goal?
An example of a S.M.A.R.T. goal would be: “The sales team will increase their revenue by 20% in the first quarter.”
Knowing who must achieve what and when makes your goals much more effective than a generic thought.
While your focus may shift a bit as your company grows, the underlying core values remain the same throughout the life of your company.
Here’s how to set actionable business goals that will help you grow your company.
1. Read your mission statement
Before you sit down to revamp your annual goals, take some time to read through your mission statement.
What is the underlying purpose of your brand? Any goal you set should impact your objectives as a company and should drive the execution of your brand strategy.
For example, if you run a real estate firm, your mission might be to help young families buy the home of their dreams. As you set your goals for the year, consider if the goal achieves your primary objective.
Anything that doesn’t fit in with the philosophies of your company should be thrown out. There are a lot of good things you can spend your time on. However, only the best things will grow your company into what you want it to be.
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2. Revamp your sales deck
Your sales deck is what you show leads to turn them into customers. Your business plan likely already maps out who your typical customer is. Use that data to create a buyer persona and map out their journey from awareness to decision. Be sure to look for new growth opportunities for your business. And remember to create a consistent brand identity across all marketing and sales channels to optimize your messaging.
Make sure you tell a story to users as they go through the sales funnel. Storytelling is one of the most effective ways to convert browsers into buyers. Set specific goals such as what information you’ll change and by when.
3. Look at longer-term plans for your business
To set goals for this year, you must look at the trajectory for the next five or ten years. Break big numbers into smaller tasks. For example, if your goal is to hit one million per year in revenue by year 10, how much do you need to increase sales each year to get to that level?
In the beginning, profit may be scant, so allow for exponential growth. Set goals that are achievable but still help you reach the final objective. What can you realistically accomplish this year?
4. Tap into market research
Most business plans include quite a bit of market research, but it’s wise to update your data every year. For example, the pandemic sped up the growth of e-commerce and changed the way people shop.
The EY Future Consumer Index found 80% of shoppers in the U.S. are shopping differently than they did before COVID-19 hit. Around 43% say they shop online for products they previously bought in stores.
Update your business plan every year with current research. Compare your predictions with what is actually going on. If you started your business pre-pandemic, it’s doubtful you planned for the rapid changes created in society.
Your yearly goals should reflect your business plan but must also consider current events in the world and your community.
5. Focus on employees
When you wrote your business plan, you may have mentioned how many employees you’d start with, but you likely didn’t have a strong company culture plan. For clues on setting goals for your employees, look back to your business plan’s mission statement.
Why did you start the business in the first place?
Your company philosophy must match how you treat your employees. If your goal is excellent customer service, but you don’t train your workers to provide top-notch service, you’re missing out on a critical element.
You may want to brainstorm with your employees about gaps that need to be filled in their knowledge. Write out some S.M.A.R.T. goals to help you accomplish appropriate training and better meet your staff’s needs.
You can write out all the goals you want, but if your employees aren’t on board, you risk failing at the most crucial task you have: finding and keeping the best employees possible. Your company’s growth will stagnate if you constantly have to stop and train new staff.
6. Do a S.W.O.T. analysis
A S.W.O.T. analysis looks at your company’s strengths and weaknesses. The acronym stands for:
Strengths – What does your company excel at?
Weaknesses – Where is there room for improvement?
Opportunities – Think through the most significant opportunities to grow your company or improve it in the coming year.
Threats – What might derail you from your goals? Both internal and external threats exist for most brands.
Once you have an idea of your weaknesses, it is much easier to set goals to turn them into strengths. You should also ask if the weaknesses matter when held up against your long-term business plan. You might not need a particular skill to get where you want to go.
7. Get a handle on finances
According to the United States Bureau of Labor Statistics, approximately 20% of small businesses fail in the first year alone. More drop-off by year five and even more by year 10.
Most businesses fail because of problems with cash flow. Either your company grows too fast for your finances to keep pace, or you let money trickle out before realizing how much cash you’re bleeding.
Part of your goal setting should include getting a handle on your finances. When you wrote your business plan, you likely discussed how much startup capital you needed and had a budget showing how you’d spend the money.
You can use the same template to revamp your goals for the coming year. Where are you spending money? What corners can you cut to save a bit? Are there places you can save more or make more?
Start with your fixed expenses, such as rent and insurance. Can you get a break on any of the fixed costs?
Next, move to your variable expenses, such as electricity, water, wages, etc. What adjustments might save you a bit of money? Will turning off the lights when everyone leaves for the day save a few dollars a month? You’ll be surprised how quickly small savings add up and help with cash flow issues and budgeting.
Plan for the unexpected, but do your best to save money. Ask your employees for ideas on how to cut costs. Give incentives to those who come up with an idea you use successfully.
Innovation drives more innovation. Ideally, your workers come to you with new ideas and help grow your business over time.
8. Seek feedback
When you created your business plan, you probably had someone help you or read articles containing actionable business plan tips. Having a mentor who has gone before you, or access to insights from others, is a vital component of success for most young brands.
Look back over your initial business plan and remember where the great ideas came from. Can you seek additional advice from those people about how to set goals for the year? Perhaps they can look at your S.W.O.T. analysis and give you some tips for improving your weaknesses and preparing against threats?
Don’t feel pigeonholed
Even after setting your yearly goals, you should never feel so bound by them that you lack flexibility. If something isn’t working, take the time to revamp the goal into something realistic for where you are at the moment.
You may overshoot the mark at times and need to scale back your plans. Other times, you may not set a big enough goal and need to increase your goal or add another one. Over time, you’ll find just the right mix to spur growth and drive your company forward.