A couple of years ago, we shared ten essential New Year’s Resolutions for business owners committed to growing their companies.
Now, we want to know: Did you follow our advice?
Here are the three top priority growth and success resolutions we suggested, as well as a few notes on where you might be if you took action – and if you didn’t.
Resolution #1: Prepare Your Budget and Projections — NOW
We said: Resolve to develop a budget and projections for the upcoming year – and commit to updating them regularly. You must continue to evaluate the conditions of your businesses for accurate as possible guesses about the future.
If you did it: You were able to plan ahead for your cash needs and develop growth goals you were actually able to achieve.
If you didn’t: You may feel like you’ve been flying by the seat of your pants. You may even have had to request a credit line extension from your bank to make payroll when cash you didn’t have was used for growth initiatives.
Resolution #2: Watch Your Working Capital — Like a Hawk
What we said: By carefully managing accounts receivable from customer, accounts payable to vendors and inventory, you can improve your cash position significantly.
If you did it: You created more cash by sending invoices out early and stretching out payments. You also got serious about asking for money you were owed. In short, you now have more control over your cash position and avoided continually being low on cash at some point every month.
If you didn’t: Instead of improving your cash position, you’re in the position of having to scramble every month. You feel stressed about invoices that need to be paid and money that needs to be collected. In essence, you’ve given power and control over to people who are not even employed by your company.
Resolution #3: Develop and Mind Your KPIs
(Key Performance Indicators)
What we said: What gets measured, gets action. Your KPIs need to include financial, operations and sales metrics, and should be compared to industry benchmarks.
If you did it: You know everything that’s measurable about your business from your client retention rate to how long it takes to close a sale. You clearly see where you can make efficiency improvements to decrease costs and increase profits.
If you didn’t: You simply don’t know where your business stands, and you find it difficult to make growth decisions when you lack that basic data. Without KPI’s, you’re operating in the dark and it’s possible that you’ve lost many opportunities or made bad business decisions because of it.
We hope that you followed our advice and planned ahead for the New Year back in 2011. But, if you didn’t, we’ve got good news: In 2013, you can turn it all around. All it takes is planning ahead and making sure you have the financial and operational data you need to make growth decisions and develop a sustainable, profitable business.
Oh, one more thing: If you need help, you’re not alone.
At some point in their company’s growth track, most CEOs need to reach out for help in order to develop financial documents that deliver good data for decision making, as well as to review processes with an eye toward increasing profit. If you don’t want to be in the “if you didn’t” category this time next year, we’re only a phone call away.