It is the end of 2022, and that means in no time, the new year will roll around. Reflecting on the past year in business can strengthen the mindset and help prepare for what lies ahead.
To begin 2023 with a clean start, there are some practical steps that can prepare a business, such as projections and tactical planning. Most entrepreneurs and business owners know that operating a company with a plan is the first step in the right direction.
“As you look forward, remember nothing changes in your past. You can only affect the future and your choices in your actions,” said Debbie Lundberg, speaker, business owner, performance coach and South Tampa Chamber board member who facilitated their upcoming 2023-27 five-year strategic plan.
What else should a business owner do to ensure success? Take a look at the following seven ways to prepare a business for the new year.
1. Engage with Employees
The years’ end is a time to evaluate not just partners but employees. As a business owner, the employees and staff are the backbones of growing and sustaining a company. While employees should receive feedback on a frequent basis, having an annual review is appropriate to assess each person’s goals and thoughts about the years past and the year to come.
Set specific quantifiable goals for each and make it a priority to show appreciation for the hard work they have put toward the company’s overall goals.
“If you do not believe employees are your biggest asset, everything else will not work,” Lundberg said. “People want to be seen heard and valued. You are better to have a smaller team than have a large one where people are not passionate.”
2. Analyze Data from the Past Year
Tracking the sales and revenue reports of a company is the ideal way to analyze the success from year to year. It could be specific products, locations, clients or outcomes that worked best and generated the most return. This data can provide insight into how to improve performances for the new year.
Take a look at what worked to continue operations and review what did not go so well. What were those big accomplishments that led to success? What goals were not reached? How can these goals become more achievable as the next year rolls around? These kinds of questions can determine the business’ needs.
“Reflect on what’s been accomplished from the year and then set planned accomplishments, because goals are good, but goals without action are just ideas,” Lundberg said.
3. Write a Business Plan for the Next 12 months
Mapping out goals before the end of the year is a great time to look forward and plan for what is to come. Creating a business plan can include strategic initiatives, setting financial targets, product ideas and growth plans, key inputs, technologies needed to acquire, customer service metrics processes and people who will play certain roles.
A plan that has clear goals is one of the most important things a business owner can do to succeed in their industry.
It is easy to get caught up in day-to-day tasks of the business, but without setting expectations for the upcoming months whether it is broken down into seasons or designed for the whole year, it can be tricky to measure real progress.
Creating a business plan with goals is also a way to stay focused on the mission for the business and ensure there is always an effort toward growing and improving for the next year.
4. Focus on Budgeting
Every business should have a budget and know that it is rarely static or consistent. Changes in markets happen. The budget should evolve with the business and the economy. If a business operates from project to project or with short-term and long-term plans, a budget can determine how to maneuver through it all.
Since each client and project varies from one to the other, going over budget should be a real possibility to consider. Plan for those unpredictable yet unavoidable moments.
“Look at the way you spend money in three categories: the cost of doing business, investments in people or the business and expenses,” Lundberg said.
Along with the budget is time. Business owners and entrepreneurs should incorporate their time and materials into budgeting and create a sustainable yet attainable budget for the company.
Once the time, materials, seasons and client needs get determined, create a detailed master budget that features income projections, a cash flow statement, a profit-and-loss statement and balance sheets. Do not forget to review potential risks, pitfalls and tax burdens that all come with operating a business.
5. Create Financial Projections and Review Your Profit Loss Statements
As the CEO or manager of a company, take a look at this year’s projections and base the upcoming projections on that with ways to improve. Working with a sales team is the best method to gain proper estimates based on markets and company operations.
Use this projection to determine price increases and understand the potential financial forecasting and impact of the business ideas. Having a solid framework in place helps compare business performances and analyze the impact from different strategies and the cost it took to deliver.
Review cash flow statements, balance sheets and most importantly, profit and loss statements which summarizes the revenues, costs and expenses from the previous year.
In this report, look at the revenue of increased sales first. This can help a company find best ways to boost profitability. If the financial statements indicate certain successful quarters or periods, then it is safe to include that on the new year’s projections.
6. Refresh Marketing Strategies
Marketing is one of the biggest ways companies can gain traction. High-quality content requires time and attention and understanding the current trends of each industry. Companies that can stay ahead of those marketing strategies before the new year can significantly streamline their business.
“Look at what went well and what’s trending so you can stay relevant with what you are doing and compare yourself from where are to where you want to be. Then, determine what works,” Lundberg said.
With those metrics identified, a great way to get ahead before the new year is to create or update a quarterly marketing plan with best practices that target industry keywords and that will provide the biggest return on investment. Also, consider building a backlog of seasonal content along with evergreen content.
7. Network with Partners
While the customers and clients are crucial to a business, the strategic partners are just as important for a company’s growth. Partners offer great insight into industry trends and potential sources of capital available.
When reflecting on how to grow new partners for the next year, consider if the current vendors and partners are benefiting from the business relationship. Business growth increases when relationships are mutually beneficial. So, when planning for the new year, consider which events will build the most successful relationships.
“Networking is not about what someone can do for you but what you can do for others. When you work with partners, you become a resource for them, and when you’re a resource, you bring value,” Lundberg said.
By Shavantay Minnis.
