6 Steps to Small Business Goal Setting
Does running your small business feel a lot like the TV series LOST… never knowing what will be around the next corner?
One has to know the destination before creating a plan as to how to get there. You’ve heard this message before, but the reason it is often repeated is because many in small business find it easy to forget. It is too easy to get sucked into day-to-day activities of putting out fires and forget there was a goal and a vision when the business first started. Face it, without a clearly defined goal, the chances are high the small business will tread water and not move forward…or worse, will lose ground.
The most critical component of your marketing map is your business goal. But before establishing your goal, you may want to review some steps I believe make this process easier and more likely for success.
1. Your business goal should be challenging AND realistic
Typically, business goals fall into two camps. Either they are insufficient to be challenging or they’re too pie-in-the sky with no chance of success. A business goal needs to whet your appetite and genuinely excite you. You want a goal that will have you jumping out of bed and energized to get cracking.
You also want a realistic goal. Can your business handle a 25% increase in sales without going into debt? What is there in your market that makes you think monthly revenues of $2,000 will be transformed into $15,000? You need goals that stretch you and your business, but not to the brink. Use a dose of common sense while still getting yourself excited about moving forward.
2. Review the current position of your business
To help you a create both a realistic and challenging goal for your business, it will help to spend some time reviewing the current state of your business. Ask yourself if your level of sales is acceptable? What percentage of your capacity did you maximize in the last 12 months? Which products/services are selling and which are not? Which marketing efforts worked to generate leads and/or sales and which just wasted time and money? Identify new trends or new competitors in your market that may impact your future sales.
With a realistic review of the market and of your business’ abilities, creating a realistic, yet challenging goal is more probable.
3. Focus on ONE major business goal at a time
A long list of goals spells failure. Focus on one challenging goal. Once you’ve achieved it, move on to more challenging goals. Besides, the success factor of achieving one goal will fuel your enthusiasm for accomplishing the next business goal.
4. Identify a REAL business goal
Often small business owners confused a business goal (e.g. increase profits by XX%) with a strategy (e.g. create a new product line, discount margins, etc.).
5. Break the goal down into 90 day increments
You want an idea of where you want to be at the end of the year, but to get there, I suggest breaking the year end goal into 90 day bite sizes. Why? Several reasons. First, to succeed, you’re going to need to monitor your marketing initiatives every week. Ninety days is a sufficient amount of time to see which initiatives are working or which are not. If they aren’t working you can cut your losses and focus on those initiatives that are working.
Another reason is small business doesn’t have the luxury of large business to spin their wheels for months creating long detailed 12 month plans. In this day and age there are just too many variables that can come into play during a 12 month period making a year long plan a wasted effort.
Besides, a 12 month plan doesn’t maximize the one clear advantage small businesses have, which is the ability to be nimble and react quickly to shifts in the marketplace.
6. Keep your business goal in front of you at all times
Ideally, your business goal will act as a filter for all of your business decisions…from staffing, to the merchandise or equipment carried, to your business processes. In this way, the chances of making a decision that contributes to the goal is more likely.
So, spend the next few days thinking about one clear goal for your business. Let it excite you and get your heart beating a little faster. Break it down into 90 day increments and factor in any seasonal fluctuations that will make it easier or more difficult for you to achieve your 90 day goals.
Armed with your business goal, you are now able to create a marketing map to help you achieve your goal. We;ll start that process tomorrow. See you then.
Feel free to ask any questions or to make any comments below.