At the start of the new year, most of us set personal and professional goals. Unfortunately, statistics show that by January 21st (just three weeks into the year), progress towards those goals has stalled — or stopped completely. Success is only achieved when goals and objectives are monitored and continually benchmarked.
This article shares three goals every business should have this year:
Budget: If you have not yet implemented a budget, this should be the year to do it. It’s still early enough to plan what you want and what steps you should take to actualize your goals. Now’s the time so that you don’t have to worry about it later on. If you have set up your budget for 2019 (kudos to you), make sure your reporting and internal schedules have regular comparisons between your budget and actual year-to-date numbers to determine if any adjustments need to be made to your business plan and/or resource allocation.
Capital Needs: It’s important to assess and align your capital needs with your cash flow projections. Many companies begin the year with big plans — and have cyclical needs for cash as a result.
For example, if you are a manufacturing company that is looking to double your sales, you will need corresponding capacity in your factories and in your supply chain as well as the cash needed to invest in your inventory. It’s important to work with your finance team to evaluate all options, such as bank financing or capital raises, to ensure the most effective and efficient usage of cash. This process is often misjudged and can be problematic for businesses that do not plan carefully.
Keep Overhead Low: It’s very seductive for expanding companies to burn cash too quickly on non-essential costs like a costlier office space, fancier cars, etc. Keeping fixed overhead costs as low as possible is critical. This becomes exponentially more important when companies have employee livelihoods on the line. Companies should continually exercise discipline, which will minimize risk in the event of a downturn in the economy or if resources need to be allocated to a planned, or unplanned, business-critical mission.
Take-away: Make 2019 a great year both personally and financially. Make sure your business creates, and stays on, a path to success with clear, specific, and measurable goals. It’s not too late, and if you need help, we’re here to assist you! For a free diagnostic assessment, contact Brian here.
Co-founders & Managing Partners