Business Resolutions for a Profitable Year
Originally published: 01.01.18 by Tim Ross
The beginning of the year is typically when we take stock of our personal lives and pledge to make improvements. But have you ever considered taking the same approach to your professional life?
Going through the process of making business resolutions forces you to evaluate your performance and address issues that may be keeping your business from reaching its full potential. Maybe you need to get expenses under control or increase your sales leads. Whatever the case might be, creating a “resolution” to tackle the problem will automatically increase your accountability.>
Now, making business resolutions may not come that easily initially. So, to help get you started, here are some New Year’s strategies that have yielded positive results for other companies, and should place your business on firmer financial footing for the next 12 months.
Develop a Budget
This might seem like a no brainer, but I often encounter business owners who think that as long as they have a rough idea of how much revenue they need to generate to cover expenses, everything should run smoothly. That approach might work for a while, but eventually it will catch up to you. You may be wasting money and not realize it until sales decline and you decide to cut costs. Writing a budget requires you to take a hard look at all of your expenditures and evaluate their importance to your overall operation.
If you’re unsure about where to begin, consider using last year’s numbers to establish costs, then make adjustments based on whether you expect business to trend up or down. Don’t forget to include taxes, fees and any one-time expenses you might be facing in the upcoming year. You may also need to make changes based on inflation or equipment pricing trends.
Once you’ve got your costs down, you’ll use your revenues from the previous year to determine your gross profit margin. That’s the revenue you have left over after subtracting the cost of the goods sold.
Remember to monitor and track your costs daily. Reviewing your profit and loss sheets monthly will also help you stay on track. While unexpected costs may arise, try to stick to your budget as much as possible.
Evaluate Your Staff
If it’s been awhile since you’ve reviewed your roster and determined which of your employees are contributing to your bottom line, now is the perfect time for that exercise. Your stars will likely stand out, but if you have other employees who aren’t as productive, it may be time to invest in more training or cut them loose.
Many people launch job searches at the start of the year, which means you’ll have more talent to choose from if you decide to make some changes.
When it comes to technicians, the key factors you’re looking for are skills and efficiency. You want technicians who can easily gauge the problem and also have the knowledge to look for other issues that may offer opportunities for upselling.
Sales personnel and anyone answering the phone should be personable and coachable. You want them to be able to follow a script to set up service and sales calls, rather than trying to diagnose a problem over the phone.
Having a good cultural fit is key, regardless of the position. Everyone on your team should embrace your values and way of doing business and should represent those tenets when they are out in the field.
If you don’t have a good system to evaluate performance, take the time to establish one, so you can decide which metrics are important and employees know what to expect.
Are you guilty of only investing in marketing when sales are down? Chances are if you marketed consistently, you wouldn’t experience those sales downturns. When you opened, you probably flooded the market with promotions because you were eager to build a customer base.
Over time, it’s easy to get lazy and assume that because you’re established, your pipeline will always be full. You can’t stop searching for new customers and you can’t take your existing customers for granted either.
Your competitors may be marketing constantly, so there’s no guarantee that your number is the first a customer will call when a problem arises. To prevent a loss of market share, consider these tactics:
Send direct mail campaigns monthly. Unlike email marketing which can easily be ignored, or TV or radio ads, which hit too wide a market, direct mail allows you to very specifically target the customers who are most likely to use your service. For existing customers, you might try offering a certain dollar amount off of a service, to help push them to address an outstanding issue. If you stay consistent and mail every month, you’ll remain on a customer or potential customer’s radar and increase your chances of gaining their business when they need your services.
Update your website. Even if your site is relatively new, refreshing it at least quarterly will help to ensure that it’s serving as a compelling sales tool. Make sure your site is easy to navigate and mobile-friendly, since more and more potential customers are now searching for services on their mobile devices. On your homepage, your phone number, address and hours should be prominently displayed. Featuring your testimonials and certifications is also important because it adds credibility. It’s also wise to include actual pictures of your technicians and staff instead of stock photos so customers can become more familiar with your business and personnel.
Invest in the community. Showing consistent support for local causes and charitable organizations is a great way to build goodwill in your market. You can even solicit employees for suggestions to get them involved and invested in supporting whatever cause you choose. While selecting a cause that has a personal connection for you is always good, it’s also wise to sponsor something that will allow you to gain significant brand exposure, such as a local youth sports league or charity run.
Resolving to incorporate some of these strategies or creating some of your own, will help you start the New Year in a stronger position.