Time for a Mid-Year Goal Review & Revamp
If you’re working to grow your business, you probably have goals that you check in on from time to time. (I hope you have goals you’re checking in on!)
One of two things might happen when you check in on your goals: You discover that you’re on track or ahead of schedule…so you sit back and rest on your laurels. Or you’re so far off from meeting your goals that you want to give up.
Of course, there is also the business owner who’s on track and wants to push a little harder. Or who is far from hitting their goals and wants to double down.
All of these examples have something in common: The business owner needs to re-evaluate their goals to figure out what’s next.
Re-evaluating Your Goals
Most of us start a new year shiny-eyed and ready to hit big goals. Then the reality of the year is upon us and we get behind. Maybe you even forget what the goals were altogether!
Hopefully you documented your goals at the beginning of the year. If so, pull out what you wrote them down on and make a note of where you are now. If you had a revenue goal, how close are you to meeting that goal? Are you about halfway there? If you had a goal to take specific action on something, have you done so yet? Do you have a plan for completing that project?
This is where you can see whether your original goal is reasonable or not. It might have been reasonable at the beginning of the year, but stuff happens. Life gets in the way. Or maybe business has exploded, making it difficult to focus on a project you had planned.
It’s okay to switch up your goals, no matter the reason why. The important thing is to have goals that encourage you to push a little harder, without feeling like what you’re striving for is unreasonable.
If Your Goal Was Cashflow or Profit Related
You know that cashflow fluctuates throughout the year, especially in the health and wellness industry. In the summer, everyone seems to be on vacation and they’re not taking advantage of your services as often. Early in the year, resolutions often revolve around wellness so you are likely a lot busier.
All this fluctuation in client commitment results in a fluctuation in revenue. And it’s enough to give you a headache, and quite possibly cause you to question your goals and ability to meet them.
After all, your operating expenses don’t fluctuate that much, and you should be able to collect a regular paycheck that you can count on.
For this reason, overall revenue goals don’t always work. In fact, a revenue goal is nice to have but it’s often a vanity metric that doesn’t mean much if your expenses are off the chart.
That’s why reverse engineering your cashflow goals can help you stay on budget month to month and ensure you’re spending (and saving) the right amount to meet your operating expense needs.
First, do a profit assessment to determine exactly what you’re making in your business right now, noting that it may be different from what you were making earlier in the year. You also need to take a good look at your P&L statements—over the course of the last 12 months. Determine what your average operating expenses are each month (total OPEX for the year ÷ 12 = average OPEX each month).
Are you making your average OPEX each month? Typically, the answer is no. Has something changed drastically in the last six to 12 months?
The idea is to allow your busier months to make up for your slower months. And if you’re spending more than 45% of your revenue on OPEX, chances are you’re not paying yourself enough. It’s time to find ways to lower your operating expenses.
But I can’t lower my expenses any more than I already have.
That’s what you’re thinking, right? I get it. Ask yourself these questions:
- Are you legitimately getting 100% value out of everything you’re spending on right now?
- Do you need two team members covering the front desk when the gym is slower?
- Is it necessary to buy that equipment this month?
- Can you negotiate a better rate on your insurance?
- Is it possible to let go of some of your equipment leases?
- Can you reduce the frequency of equipment maintenance because usage is lower?
The more you can lower expenses, the more profit you’ll be able to bank. And that is the important part.
If You’re Not On Track
You might be feeling stressed out about where you are with your goals right now. Maybe with just one or two of your goals, maybe with them all.
That’s okay. That’s why we check in mid-year so we can course-correct and move forward with more confidence.
If you feel like you’re really off track, brainstorm what roadblocks you’ve encountered that have thrown you off. It might have been something you weren’t expecting, or it may have been something that’s been a long time coming.
Either way, it’s time to adjust your goal based on some of the information that we’ve already discussed here. You need to change what you’re doing to help you get to where you want to go.
Goals that are revenue or cashflow driven are valuable and easy to measure, but sometimes you need help to make it happen. That’s one of our specialties at Fit For Profit. If you’re struggling to make this year the year you get your cash and profit in order, let’s talk! Sometimes a little accountability is necessary. Book a call with us today.