Setting Financial Goals That Drive Your Business Forward
Every business should have a written mission statement with a clearly stated purpose that reflects your core values. Your mission statement should be considered when developing your business plan as well as your business goals and objectives. Establishing your mission statement is important in the beginning stages of your business so you always have a written reminder of why you are doing what you are doing and how you should be doing it.
Mission statements can evolve and change over time, but they should always be considered when developing both short- and long-term business goals. If your mission and purpose change significantly, your goals will also need to adjust to reflect those changes.
Getting Rich Should Not Be Your Only Goal
If your only goals are money-centric and financial gain is all you ever focus on, somewhere along the way you may lose your soul to marketing that is either deceptive or not congruent with your core values in order to meet lofty sales goals. Simply making money should never be the exclusive goal of any business. Focusing on increasing revenue without concern for brand and corporate vision is a common mistake budding entrepreneurs end up making when their initial success attracts investors who may offer enticing sums of cash in exchange for their say in how you market your business.
As your business grows, it's easy to become overly excited about the money coming in and hard to resist the temptation to expand too quickly (which is a common detriment to many business owners.) The saying “pride comes before a fall” holds true when it comes to making business decisions—being too full of your own successes can lead you to a path of too-rapid expansion that is not sustainable in the long run.
Bad marketing and vocal investors can have a negative impact on your brand, and once your brand is tarnished, it can be hard to get back on track – especially if your investors have a say in how you run your business. It is extremely important to factor in your purpose and values when you set financial goals so that investors do not get much say in how you run your business and so that your clients and customers see those values as synonymous with your products and services.
Smaller Business Goals Facilitate Bigger Financial Goals
Making $1 million dollars in sales is a nice goal, but all by itself, it is a goal without substance unless you have mapped out other goals to help facilitate those sales. If money is your only driving passion, you, your employees, and the business will all suffer. In fact, studies on discipline, self-control, and success show that constantly expending high energy to achieve success can be unhealthy for you.
While growing your business’ bank account, you also need to focus on growing its people, your customer base, and improving your company’s overall worth including product-consumer demand and positive branding. Success comes in many degrees, and setting and achieving smaller goals that lead to fulfilling larger goals can be very rewarding.
Business Goals: Steps Toward Achieving Larger Goals
Every long-term or large goal should have smaller goals or steps that will help you achieve those larger goals. As an example, let’s say that your large goal is to make $1 million dollars. How will you do that? What steps are necessary in order to increase sales? How will you handle the increased volume? Will you need new manufacturers? How will you gear marketing toward that objective?
Answering all these questions will help you develop smaller goals that support your main goal of making $1 million dollars. Let’s look at just one of the above examples as a small goal.
What steps are necessary in order to increase sales? You might need to:
- Purchase more supplies to increase manufacturing
- Increase warehouse stock (increases cost of storage)
- Launch a mass social media campaign
- Create a radio ad
- Train customer service staff to handle an increase in sales
All the above items look like a list, but they are actually goals you may need to meet before you can achieve that million-dollar goal. Without enough product to supply an increase in demand, or the ability to move products quickly and cost-effectively, your sales are not likely to increase exponentially over what you are already doing.
Planning Smaller Goals Is Important
The "Oprah Effect" is a fairly well-known example of good intentions meets blind ambition. The Oprah Effect is an expression that first came about after seeing the effect that an appearance on The Oprah Winfrey Show, or an endorsement by Oprah Winfrey, had on businesses. Small mom-and-pop business owners appearing on Oprah were suddenly flooded with more orders and emails that shut down their websites, phones that rang nonstop, and an overnight increase in demand that could not be met.
Growing Your Business By Setting the Right Goals
All for-profit businesses exist to generate income (profit) and your goals should strive for financial success, but remember to take time to develop additional, non-monetary goals that help build your business:
- Branding encourages customer loyalty, which can lead to repeat sales.
- Great customer service can lead to good reviews that encourage others to trust your business.
- Developing employees by offering them training, support, and growth opportunity will also help you build your business.
Strong businesses are not those that simply bring in big bucks because consumers can be fickle, markets can change, and what worked once may not work a second time around. Solidly built businesses have staying power based on their reputation -- not just their financial reserves.
Create goals that focus on year-over-year growth and positive forward movement by also defining goals that invest in your company's infrastructure, brand, customer service, staff, and customer loyalty programs, and your long-term financial goals will be much easier to achieve.