Taking Stock of Your First Year in Business
It is important to assess your first year in business. You cannot just keep on doing the same thing, year after year, and expect to create a successful business.
If you don’t continually take stock, you’ll end up like one of those tired old shops on the high street that’s still trying to sell dusty alarm clocks in the shape of Mickey Mouse, with fluorescent ‘sale’ cards in star shapes and a jumbled window display.
Nobody owes you a living in business. It’s up to you to stay ahead of market trends, offer a competitive product at a competitive price and exceed your customers’ expectations.
The best way to do this is to have an annual assessment of your business, as well as regular critical analysis throughout the year.
An Overview Of The YearYour annual ‘taking stock’ is nothing to do with an actual stock take, rather it is a way to take an overview of the year and decide what you will aim to repeat, what you will avoid and any new ideas for promoting your business.
Set aside a morning or afternoon to take stock of your first year in business. This is one of the most important things you can do as it will save you time and money going into your second year in business. Don’t forget that the end of the first year is the most common time for new businesses to fold – you don’t want to be one of them or all your hard work will be wasted.
Ideally, you can enlist the help of a business-minded person that you trust to work through your taking stock session, but if you don’t have such a person (they can be very helpful) and you are able to see your business in as non-judgemental manner as possible, just go ahead by yourself.
Collect All PaperworkStart by gathering together all your paperwork. Assuming you have been organised throughout the year, this shouldn’t take you long. If you have not been organised throughout the year, you will need considerably longer than a morning or afternoon to do this!
Brainstorm where you feel you performed well, in conjunction with your paperwork. While it is not all about profit, there is no point repeating a promotion that didn’t gain money or good PR. Make clear records of what promotions brought in what revenue, what kind of customer feedback you had, how much hassle it was, and so on. Write down whatever you think of because you can put it into a clear order later.
Next, do the same, but for the situations throughout the year that were difficult. Did you have trouble finding the right staff? Did you have to pay recruitment fees? Did you have difficulties with suppliers or customers?
Again, write down everything and cross-reference with your facts and figures.
Use The Information To Your AdvantageOnce you have all this information, including practical financial information and the emotional aspect of your business, you will be able to make a clear understanding of your first year in business. You can see what earned you money, what was good for business, what is worth repeating and what suppliers you need to renegotiate with.
You owe it to yourself to act on this information. It can actually be a good way to start difficult conversations with recruitment agencies, suppliers or staff, as you can say that your annual business assessment showed up certain issues that need to be dealt with before the start of the next business year.