The new financial year is almost upon us and now is the perfect time to start thinking about your financial goals for the upcoming year.
There are a number of different ways to work out what you want the next years’ numbers to look like and include the following:
- Identify the amount of money you want to take home from the business to pay your household and family costs and enjoy the year. Or to put it another way, how much profit do you want to make after you have paid all the business bills including reasonable wages for you and everyone who works in the business?
- Set a target for income for the year. Increase this from the recent results. However, it is imperative that you make it a figure which you believe is achievable.
- Set a target for the number of products you want to sell or the number of contracts you will take on or the number of types of transactions in your business.
These are all great starting points to putting together your financial goals. Add to this the amount of money you want to have in the business bank account at the end of the year and you have the starting point to prepare a budget for the business.
Too many business owners don’t set financial goals and often find that their financial position is no better and often not as good as it was the previous year.
It’s a bit like going on holiday without a plan of where you are going and how to get there. For a happy holiday, in most cases, you need to know where you want to go and have a map or travel plans to get you there.
Treating your business the same way will help you achieve better results in the coming year as when you focus on the key numbers, you will be surprised to see how accurately the results become exactly what you set the goals to be.