It’s the end of the year again. After all the eating, shopping, and merrymaking during the holidays, use this time to sit down and review your business performance. Use this time to assess how your business performed this year in order to help you make plans for a better next year.
Here are 10 checklists for your end of year review:
Organize your accounting records.
Find all the business receipts for all your expenses during the year. Get all documents you need for your taxes ready. Print a copy of your financial ledger. Prepare your budget for next year. And if you are doing this only at the end of every year, then you need to review your whole bookkeeping and accounting process. Maybe it is time to hire an accountant or bookkeeper for your business.
Work on your financials.
If you are like some home business owners who don’t do regular bookkeeping as part of your weekly or monthly routines (or worse, do their financials only once a year in time for tax time), now is the time to start doing your bookkeeping, prepare your income statement and balance sheet, and other financial reports. Get a clear picture of how well you did with your business by determining your actual income and expenses for the year.
Analyze your financials.
Take time to go through your financial statements and understand your business. It is important to know where your revenue is coming from, what are your biggest cost items, and who are your biggest customers. Better yet, compare your numbers with industry benchmarks (check trade publications or trade associations if they have data on industry benchmarks). If this is something that you cannot do yourself, talk with an accountant or financial analyst to help you understand what the numbers mean, and how you can use these numbers to improve your business.
Assess what worked for you.
Make a list of what worked — and what did not work — for you this year. What did you do to win that big account? How did your web site traffic spike up significantly? What did you do to improve the conversion rate of your ecommerce site? Look closely at your products and see which ones are doing well, or which ones you’ve seen decline this year. Review your relationships with your partners and suppliers, and identify the important lessons that can help you improve your business relationships in the years to come. A list of what worked for your business can give you confidence to move forward and help you avoid costly mistakes and problems. And if there are problems, determine if the problem is something you can resolve yourself, or whether you need outside support (e.g. a mentor or consultant)
Review your marketing strategies.
Take time to analyze your marketing mix this year. Ask yourself the following questions:
- What strategies brought the most customers?
- What is the most cost effective strategies?
- Are there ways you can cut down the costs yet get the same — or even better — results?
- More importantly, what other marketing approaches do you think needs to be done to take your business to the next level?
Examine the numbers behind each marketing strategy – how much the campaign costs, what are the return on investments, and what are the results of using these strategies. If you find that a particular marketing strategy is not delivering the results you want at the price you’ve set, then don’t be afraid to discard that marketing strategy and replace it with a different type of campaign.
Know your customers.
Now is the time to get a clear idea of who your customers are. Some businesses have a clearer view of who their customers are, while some do not. For example, a landscape business owner knows that home owners in his area are his target market; but a blogger may not exactly know who reads his blog and why. If you are the latter type of business owner, devise some ways you can get a better picture of who your customers are. It is also important to know which ones are your most profitable customers – and then give them the VIP treatment next year.
Give thanks to your best customers.
Now is the time to touch base with your best and most profitable customers. Send them a thank you note for their continued patronage of your business. Give them a call to ask what else can you help them. Let them know that you appreciate their business, and hope to work with them again in the new year, while making sure that they are satisfied with your products or service.
Review your website.
Sit down and think what content or products you need to offer next year. Go through your website statistics and study the data, including traffic levels, what pages are perused the most, where your traffic is coming from, etc. Check to see if there are any pages you need to overhaul or misspellings you need to correct. If you are one of the few holdover entrepreneurs who does not have a website, then one of the important projects you should undertake next year is to create your online presence.
Improve your knowledge.
There is always something new to learn. Whether you want to better understand the implications of financial numbers or need to learn how to be a better salesman, now is the time to assess your training or education needs. What do you want to know? What do you want to improve? Then find where you can get that information or training. Check with the Small Business Administration, which offers free online courses on a variety of topics from business management to government contracts to tax/accounting basics to managing the digital enterprise. Check also with your local colleges or country continuing education programs if they offer classroom training for entrepreneurs.
Organize your office.
If the end of the year is a slow time for you, take time to purge your office from junk. Clean up the clutter. Buy new binders, folders or other products that can help you organize your papers. If you are looking for last minute business tax deductions, spend money improving the look and efficiency of your office.