How to Build Your Business by
Looking At The Previous Year

by Tom Egelhoff

Last Year: Was It A Boom or Bust For Your Business?

Last year is history. If your fiscal year ends in December then you probably already know if it was a good or bad year for your business.

The question is what will happen in the new year?

Look At Your Favorite Sports Team

To be more successful this coming year why not take a page out of your favorite sports teams evaluation process.

Before each game coaches and players review game films. They look at their last game and films featuring the next opponent.

In order for this to work for your business you would look at what you did last year versus your competitors and what you did successfully against them and what you didn't.

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You Need Two Files

In many of my columns this year I have stressed that you start two files.

The first file is all of your competitor's ads, brochures and flyers for each month of the year. If you had started this last year you would know exactly what items your competitors advertised last January.

You could compare their ads to yours and evaluate how good January was for your business.

There's no guarantee that your competitors will do the same thing this January but most likely they will do something similar.

The second file is what I call a "swipe file."

It's a file of any advertising for any product that you like.

Colors, designs, typefaces, etc.

It will help you in creating better ads in the future. Look for words or phrases that can be adapted to your business.

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Don't Try To Match Your Competitors

It isn't the idea that you match competitors dollar for dollar; it's a matter of advertising smarter and more economically.

If your ads from last year worked and you had a successful month why not run the same ones again.

You're obviously reaching your target market and the ads paid for themselves.

There's certainly nothing wrong with repeating something if it proved to be successful in the past.

If your ads were not successful then you need to re-evaluate what happened.

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Build On Your Employees

The next area to tackle is your employees. They've just gone through a very stressful time.

They put up with longer hours, hostile customers, problems, returns, complaints, etc plus finding time for their own Christmas shopping.

In order to get them off to a positive start you should involve them in the planning process for the first quarter goals.

One of the best reasons to do this is that problems are going to be fresh in their minds.

If a procedure or policy need to be changed or updated this is the best time to do it.

And by all means give everyone a personal thank you for the hard work they did over the holiday season.

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Don't Forget Your Business Plan

Next, you need to review your business plan.

That's the plan you did way back when you got your loan to start your business and haven't looked at since.

Your business plan is a road map to success. It should be reviewed yearly.

Sit down with your accountant and review your financials.

Are your financial projections from the past coming true or are you falling short of what you projected.

If you're doing well in your business then keep doing what you're doing. If not, then where is the problem?

Payroll? Inventory? Expenses? Think of your business as a patient and you are the doctor.

If there were a sickness what would you prescribe to make your business well?

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How To Raise Your Profits By 2%

The next area to look at is waste. This is one of the biggest problems to most businesses. It eats away at profits little by little.

It's easier to raise profits 2 percent by cutting waste than it is to increase sales 5 percent.

The easiest ways to cut waster is to let your employees know how much it hurts the business.

Open your books to them. You don't have to show them everything but make them aware of how much waste affects them.

If you could make the same profit yet pay your employees more would you do it?

Most owners say yes. If you can get them on board to be waste conscious then you can do exactly that.

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The Final Word

Last but not least take a look at your business as a customer might see it.

Could it use a coat of paint, maybe new or cleaned carpets? These are things that can often be bartered depending on the type of business you have.

Take a look at your competition. How do they look compared to you?

The bottom line is you don't have to spend tons of money to improve your business.

Sometimes it's the simple things that make all the difference. But you will never see those things unless you look.

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