Ah, finally the end of year holidays are approaching again.
It’s time to kick back, relax, turn on the out-of-office autoresponder and unbutton our collective pants as we prepare to overeat and throw productivity to the wind for the next couple of months… right?
Well, while that may work for some, it turns out (coming at no surprise to us), that successful small business owners are a particularly optimistic, hard-working bunch. In fact, heading into 2018, over 90% of American small business owners reported feeling optimistic that this year would be a successful one for their companies.
That optimism doesn’t just come out of nowhere. It’s rooted in innovation, calculated risk, experimentation and most of all — consistent execution. With solid economic growth, a low unemployment rate and a stock market that’s hit all-time highs, for the most part, 2018 has been a great year for American small businesses.
Even when things are looking good, the end of the year is the perfect time to reflect back on what went well, where there’s room for improvement, and how to plan appropriately for what needs to be achieved in the year to come.
Though admittedly, there’s often a very fine line between enthusiastically planning for the major strategies, campaigns, changes and initiatives we’ll be taking on in the year to come—and frantically scrambling to accomplish all of the end of year to-do’s that also need our timely attention.
To help you strike the right balance between planning for the new year, and making sure no major priorities (or legal responsibilities) are left unfinished this year, here are the five most important things your business needs to be concerned with as you wrap up the year.
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1. Analyze your key business metrics for the year.
The goal of taking a deep dive into the “numbers” surrounding your business, is to determine exactly where your attention needs to focus in the new year.
Does revenue need to grow faster than it currently is? Are your expenses getting a little out of control? Did you acquire fewer customers this year than the year before? What’s the average value of newer customers during their first year, compared to older customers?
The questions you seek to answer from this analysis will vary from business to business, but what’s important is that you’re gathering insights to help perform better in the year to come. For example, since starting my blog a few years ago, I’ve been maniacal about creating regular time to sit down each month (and at year end) to review changes — both good and bad — in my main revenue streams and traffic sources. The goal of this is to uncover new opportunities and redirect attention to important areas of my business that may have slipped throughout the year.
Which metrics should be most important to your business? Here’s a good starting point, and remember that it’s always better to calculate year-over-year growth rates for these metrics, rather than simply looking at a single snapshot in time. Examples could include:
- Number of customers
- Average customer value (for the year)
- Average duration customers stick around
- Lifetime value of a customer
- Website traffic
- Number of leads/email subscribers
- Conversion rate from lead to paying customer
Again, don’t just capture these figures and store them in a spreadsheet somewhere.
Challenge yourself to determine what you can learn from these numbers when it comes to the health of your business. Then it’s time to create a plan of action for accelerating the good and correcting the bad.
2. Celebrate the wins.
Here’s a sad reality: the vast majority of entrepreneurs and small business owners, even those running sizable, profitable companies, never really feel truly successful with where they’re at in their businesses.
Maybe it has to do with our constant drive to achieve more, the temptation to compare where we’re at with other more successful entrepreneurs, or the tendency to always be looking ahead for the next big milestone.
But what’s even worse, is that this lack of satisfaction, pride, and gratitude for our achievements, no matter how small or large, can ultimately lead to serious burnout if left unchecked. So, how do you start to retrain this mentality and correct this potentially damaging behavior?
Well, giving yourself permission to take a break from your regular workday routine to intentionally think about, uncover and celebrate the wins you’ve accomplished this year, is an incredibly powerful exercise.
Here are some of my favorite ways to regularly celebrate small wins in my business:
- Take a day off to go be outdoors, hike, explore and try a new restaurant
- Splurge on a fancy dinner, extra date night, or weekend stay at a nice hotel
- Give myself a creative day where I practice my craft (writing) without an agenda
- Treat a friend to joining me for a local concert or sporting event
- Pick up a new gadget or tech tool I’ve been wanting to buy for myself or my business
This shouldn’t just be a yearly activity, either. Create the time in your schedule to regularly do small things that celebrate the launch of a big new campaign, after a particularly successful month, or when closing a big new deal.
The goal is to actively stay engaged and excited about your business.
3. Determine (and prioritize) your main objectives for the new year.
Once you have a clear picture of the numbers behind your business, it’s time to decide on which (few) activities most need your attention and prioritization in the new year.
What does a successful 2019 look like for your business? Strive to only set smart goals that qualify as being specific, measurable, achievable, relevant and time-bound.
Instead of saying you’d like to grow your revenue by 20% next year, a smart goal would be something like, “By the end of 2019, I want to hit $500,000 in revenue from acquiring 250 more customers than we did this year, and upselling 5% of existing basic customers to our more expensive pro plan.”
There’s no room for ambiguity with this goal. It’s incredibly specific, and from this goal, you can clearly define the core priorities your business needs to take on in the new year. This could include planning how to acquire customers at a higher rate than currently, and a workflow for upgrading some of your existing customers to a higher-priced plan.
Once you’ve determined your main objectives for the coming year, you’ll need to ruthlessly prioritize executing on the handful of activities that’ll get you closer to achieving those goals. Set up systems and employ the right productivity tools to reward yourself for staying focused and on track throughout the day, week, month and quarter.
And for small business owners with a steady stream of new opportunities and demands, this also means saying no to just about everything that doesn’t align with your predetermined targets for the year.
4. Keep the tax people happy.
Like it or not, all small businesses need to comply with local, state and federal income tax filing requirements. Whether you work with a bookkeeper or use tools like Intuit Quickbooks to stay on top of your finances, the first step you’ll want to take (before the end of the year) is sitting down to look over the numbers yourself.
Organize all of your statements, financial reports and, depending upon the complexity of your business, either prepare to schedule an appointment with your accountant who helps file your tax return, or set aside the necessary amount of time it’ll take to prepare your own tax returns if you’re a numbers person.
Here’s a checklist of a few more crucial activities you’ll want to accomplish this year to get ahead of the curve for the upcoming tax season:
- Schedule an appointment with your accountant
- Organize all of your bank statements and financial reports
- Update your mileage log (if you drive a vehicle for business at any point)
- Track down all business expenses you may have paid for with personal funds
- Double check you’ve properly recorded any personal expenses paid by the company
- Request all 1099 forms from clients you provided services for during the year
While this is by no means an exhaustive list of all your small business tax responsibilities, checking these items off your to-do list sooner rather than later will make your life that much less stressful over the coming months.
5. Employ the right tech tools (and people) to accelerate into the new year.
As you’re evaluating where your business is today, and more importantly, where you want it to go over the course of the next twelve months, you should take into account which products, tools, people and services can help accelerate your progress toward your goals.
Whether it’s activating the right project management tools to help stay on task over the coming months, making the upgrade from spreadsheets to purchasing a proper sales CRM, getting more streamlined team communication tools like Slack in place, or otherwise, investing in the right tech tools can help your company grow in major ways.
Finally, if you’re planning to take on an endeavor like expanding into a new vertical through activities like digital advertising, content production, trade show appearances and ramping up sales outreach, that’ll probably translate into increasing your headcount through either full-time staff or contractors.
As a result of managing a larger team and taking on bigger projects, it can be easy to get bogged down with managerial tasks like processing payroll, invoicing, checking in on everyone and somehow managing to still get your own work done. That’s where tools like Hubstaff that help you streamline your team’s productivity, come into play.
This guest post was written by Ryan Robinson.