Successful entrepreneurs set and monitor business goals. Goals are a powerful way to clarify the purpose of your business and help identify necessary actions.
In my experience, few small business owners keep track of their business goals. The importance of setting goals is to help you make better decisions. It will help you move away from the habit of making business decisions based on your gut feeling or your bank account balance.
Benefits of setting business goals:
- Gives your business clear direction
- Provides a reason behind every decision
- Enables your team to become focused on your mission
- Helps you achieve optimal performance
- Helps you identify new opportunities
Benefits of monitoring business goals:
- Enables you to act quickly when performance is off target
- Enables your business to remain viable during market or economic changes
- Enables your business to be nimble
- Helps to maintain or increase good times
- Acts as a safe guard during tougher times
What does a business goal look like?
The goals must be S.M.A.R.T. (specific, measurable, attainable, realistic and time sensitive). They can be short-term or long-term and they should support the business’ mission. They should provide a clear understanding of what your business is striving to achieve.
When setting goals, be specific. Don’t just make general statements like, “My business will be profitable”. It is not specific enough. How profitable? How many customers do you need to be profitable? How many times do you need them to buy each month/year? How will you know your business is profitable?
The S.M.A.R.T. way to state that goal may be, “My business will attain a net profit margin of 15 percent within the next 12 months. To do this, we need to increase new customers by 5 per month, with an average sale value of $1,500 each”. This detailed information will now help you to implement an action plan to achieve that goal.
Once your goals have been set, they need to be tracked, measured, adjusted (if necessary) and celebrated if achieved.
How can your accountant help?
A good accountant will actively encourage a business to set and monitor goals and objectives because they provide a guide of what the owner/s want to get out of their business. Clear Path Accounting can help you to: set goals, plan the implementation, provide accountability to ensure you remain focused and motivated, and measure your progress. We will also present and explain the numbers in a way that you fully understand.
We want to help you make your dreams come true, in fact our mission is to “empower business founders and creators to build a business that best represents their vision”.
What business goals would you like to achieve in the next 12 months?
Sit down with your business or life partner and discuss what you would like your business to achieve in the next 12 months. Be brave and aim high!
Contact us or call us 02 4739 2700 to book a meeting so we can get to know your business, and help you to set, monitor and achieve your business goals.
Written by: Suzanne Walker CPA