The new year is right around the corner, which means businesses should be wrapping up their year-end checklists and beginning to think about how they can improve their strategies for success in 2022. At this time, business owners should be asking themselves the tough questions about their business’s honest performance over the past twelve months; questions such as “Did we reach all of our intended targets?”; “Were our profits really as good as we had hoped?”; “Where did we fall short, and where can we do better?”
Knowing where you’re going requires knowing where you currently stand, and that means gaining an accurate assessment of your business’s available options, as well as its strengths, weaknesses, and threats. In this article, we’ll be taking a look at some important things that business owners should consider when analyzing their business for the new year, as well as providing some potentially useful tips that can help with establishing priorities, plans, and goals for the upcoming season.
GET YOUR FINANCES IN ORDER
As with all good business plans, the first order of business will be to consult with the company’s accounting department to get a good idea of the current financial situation. In this stage, it would be useful to find out how your business performed over the last year as compared to past years.
For an accurate assessment, have your accountants prepare the standard financial statements: the balance sheet, the income statement, and the cash flow statement; this will give you an understanding of what the business’s biggest expenses have been in the past year. Once these three things have been examined, be sure to also have them check your ratio, total debt ratio, and profit margin to get a more complete picture of where your company stands financially.
Again, be sure to have your accountants prepare reports on the following items to gain an accurate picture of your company’s financial health:
- Balance sheet
- Income statement
- Cash flow statement
- Total debt ratio
- Profit margin
DO A SWOT ANALYSIS
Once all your financial information is in order, the next step you should take is to analyze where your company is in terms of its position in the market. To do this, the best thing you could do is conduct a SWOT analysis.SWOT stands for “strength, weakness, opportunity, and threat” and can provide a comprehensive picture of your business and its potential options for expansion. SWOT is perhaps best used when determining a business’s competitive advantage over others, which can help businesses to lean into their strengths and cover for their weaknesses whenever possible. Fortunately, for marketing managers, performing a SWOT analysis is not a difficult process; all it takes is a few simple steps. To start, draw up a diagram with four quadrants like the one shown pictured below. Next, consider both internal and external factors that could apply to each of the four quadrants. At the end of your assessment, each of the quadrants in your diagram should contain a list of all of the relevant factors that apply to your business in that way.
As the fifth-century Chinese philosopher, Sun Tsu, once said, “If you know the enemy and know yourself, you need not fear the result of a hundred battles,” and with a SWOT analysis, you can get a pretty good idea of where your business stands as compared to the competition. Knowing what your business does best will always be useful for helping to leverage new opportunities to your advantage, while honestly assessing your company’s weaknesses is a good way to identify potential future threats.
Analyzing your business using a SWOT analysis can be a useful way to understand your position in the market before creating a strategic plan. Once it becomes clear exactly what your strategic position is, what your strengths and weaknesses are, and what your potential threats and opportunities could be, deciding what goals you’d like to achieve will be the next logical step towards formulating your strategic plan.
CREATE SMART GOALS
When attempting to create your new campaign for the upcoming year, deciding what’s most important can sometimes be a difficult challenge, which is why you should always attempt be smart with your strategic goals. The best way to do this is to begin setting SMART goals.
For those who are unfamiliar with the term, SMART is an acronym that stands for “Specific, Measurable, Attainable, Relevant, and Time-bound,” which is a reference to the strategic goals that a company can set for itself before deciding to go through with a campaign. SMART goals are useful for setting immediate short-term goals that can bring tangible, measurable results within a certain allotted timeframe; the idea behind setting SMART goals is to make small, incremental steps towards a larger goal that can eventually be achieved at a later date.
If SMART goals were to be phrased as a question, that question would be asking “what specific task can I do right now that will move me closer to my long-term goal and bring me measurable results; hopefully, by the end of next week.” The answer to this question, of course, will vary across departments; however, ensuring that all departments have some goal to work towards is important for providing a company with stability, direction, and a way to assess growth.
Ideally, SMART goals should be set for every department in a company with the aims of that specific department in mind. Management, too, should also have its own set of SMART goals listed for its greater organizational objectives, such as receiving higher ROI. In all cases, however, SMART goals will be dependent on the overall long-term objectives defined in an organization’s mission statement, which should be revisited every year and revised when necessary to meet new strategic aims.
Put simply, if a mission statement is an organization’s destination and ideal state, then SMART goals are the steps that should be taken to help bring the company to that ideal state, which is its overarching goal. In this way, when long-term objectives are clearly defined, so that everyone in an organization is on-board with the same idea, short-term goals and the steps required to meet them can be more easily determined and a way to view the company in relation to its overarching goals can be understood.
PUTTING IT ALL TOGETHER
In this article, we touched briefly upon some important considerations that business owners should make before deciding their New Year’s resolutions. Specifically, we covered the importance of organizing company finances prior to New Years, assessing potential threats and opportunities, and defining the goals that will help to guide decision making throughout the next year. We also discussed two techniques that can be used to help business owners to recognize their strategic positions in the market (using SWOT) and set priorities for their strategic goals (using SMART goals).
In total, the information in this article should be able to help business owners to learn from their past dealings and recognize opportunities that are currently there in the present, while also providing them with a method that can be used to help them set short-term goals for the future.
With the new year fast approaching, gaining an idea about your company’s current standing in the market can be important for deciding how to conduct business in the year to come. Fortunately, with accurate knowledge of your finances, potential marketing opportunities, and priorities for the future, you can enter the new year with confidence knowing that all of your bases will be covered for 2022.
LOOKING TO GET A HEAD START ON THE NEW YEAR?
As 2021 slowly draws to a close, many business owners are wondering how they should begin preparing to transition into 2022. Following current trends, what businesses can expect to see are greater demands for convenience, personalization, and social responsibility, as well as more accessible services, and contactless pay. For vendors, this will mean focusing on customer service and retention, which will require a strong loyalty program and a means for providing omnichannel access to customers across all possible devices.
Fortunately, for vendors, FTx POS is built specifically for providing a fast, cost-effective service that automates much of the business process: from contactless payment to updating prices across stores from a single location; FTx POS is a complete suite of fully integrated tools that allow vendors to cut out much of the hassle of business and get back to sales. Core features include time tracking, biometric security, mass updating, inventory management software, and cloud storage for extra protection against both power outages and hackers.
FTx POS also integrates seamlessly with our sister company, Loyal~n~Save, which offers a fun and easy-to-use mobile loyalty app that comes equipped with A.I. learning for a better, more personalized online shopping experience. With Loyal~n~Save, companies can boost retention and improve access to goods, all while incentivizing customers to shop more and tell friends, so that they can earn points towards receiving better deals and swag from the online Swag Shop.
For more information about how to secure customer loyalty, visit loyalnsave.com to learn more about their innovative marketing services and solutions.
And for more information about FTx POS, please reach out to one of our team members to schedule a free demo or consultation.