The title of this article sounds like a business question with an obvious answer. And you would be correct in your thinking that year-end business profits are important to your company’s success.
But let’s look at this a bit more in depth.
As a CEO, president or business owner, it’s not just year-end business profits that are important to the success and longevity of your business.
Here’s why:
Remember: The reason to be in business is to make a profit. Period.
If you’re not going to make a profit, you’re not going to be in business for very long. You cannot operate a sustainable business without consistent business profit.
The motivation for being in business may be different. Maybe you wanted to be your own boss. Maybe you wanted to hire people and provide jobs within your community. Maybe you wanted to make a better product or provide a better service. Maybe you saw the opportunity to fill a gap in the marketplace. Maybe you wanted to change the world or prove something to yourself. Whatever it happens to be, to live your business dreams requires the company earning a profit year after year. That’s how you make your world and the world around you a better place for everyone.
The product or service your company offers is simply what you do every day. It’s what brings customers or clients.
Multiple factors go into the reasons for the existence of a business. But ultimately, it’s about making money; being profitable.
Now, as businesspeople, we come to the time of year on the calendar when we start to look at and we start to think about:
- What kind of year is it going to be?
- What will be the final numbers for the year; especially annual revenue and annual profit numbers.
- What are going to be the final numbers on year-end business profits?
How important are the year-end business profits?
Answer: Extremely important.
At this particular time with it being the end of a calendar year, your company can either come out with a really great profitable year; or, if you’re not paying attention, you can end up losing money or breaking even (if you’re lucky).
Always make sure, as a CEO, president or business owner, you are staying focused especially at the end of the year. Don’t allow the holidays or other activities to distract you from business. This focus will help to bring the business results or year-end business profits you planned for and set goals for throughout the company, at every level.
But there’s an even more important message here.
The important message is:
If you do this right consistently, if you’re really paying attention not just as another year ends, but you’re paying attention in January, February, March, April, May, June, July, August, September, October, November and December… you don’t have to worry about your year-end business profits.
Year-end business profits begin on January 1st. Not on December 1st.
If you have to worry about your year-end business profits, then you haven’t done what needs to be done in your company. Everything needs to be in place right now.
Your appointments should be set up. You should be in a position where you’re closing deals. You should be in a position where you have a great backlog and you have a lot of receivables. You should have a constantly updated business plan and strategy.
Yes, pay attention to the end of the quarter. But what you really need to do starting in January, is pay attention to each month.
Pay so much attention as if you are stone cold broke at the first of every month. Make sure January is an outstanding month. Make February even better. Make March be right on target. First quarter of the calendar year will be a success. Then make your planning and strategy a success going forward for each and every month and quarter. The success and profits will add up to year-end business profits.
Remember: It doesn’t matter what you did last year in your business. It only matters what you do in your business this year. The same is true month by month. Week by week. Day by day. But at the beginning of every year; every month, act as though you are stone cold broke so that it drives you not to an overload of stress but to a strategic plan of action for success.
There may be a couple of months in your business, and this is in every business, where there will be a slow time. Depending upon the industry your business is in plus its geographic location can impact when the slower time may occur. But, even when your company experiences a slow time, especially when you know it’s coming, make certain there is enough ongoing prospecting, sales and marketing activity, so the business isn’t losing money. Maybe you don’t make as much money as you make the in other months of the year. But breaking even in the slow time is making money because your company is not going to be in the hole.
It’s important to keep in mind that every single business day it must be understood by everyone in the company what needs to be done to make money. It must be understood every single day what needs to happen to create the prospecting, the marketing, the sales pipeline, and finally, to close a sale or sign a new client contract. The sales pipeline and prospecting create the opportunity to talk to a potential customer. The appointment and the presentation create what’s going to happen next. What happens then? You sell your product(s) or service(s). When you sell you’ve got receivables and the potential for repeat business.
So, it all ties together, but it ties together day-by-day, not just for one month or even one year. It is a continuous cycle of planning, strategy, vision and being in action. Being proactive not reactive. You never want to be in the position of saying to yourself: My goodness, look at the numbers! I have to hurry up and bring some money in because it’s going to be the end of the year and I need to make a profit.
Remember: The goal is to be profitable every business day. Not just when the numbers are added up at year-end.
You need to be aware of what your profit status is all of the time. Focus on what needs to be done every single day, every single week, every single month of the year to make a profit. Don’t just focus on year-end at the end of the year.
If the business is not making a profit, you need to be aware of it. Look at the monthly profit & loss (P&L) statement. Analyze why the numbers didn’t happen; why the company is not making a profit. Make the necessary changes to get back on track; to get profitable again. Day by day; month by month. Make those year-end business profits just a number to be celebrated!
To your success!
Business expert and strategist, Howard Lewinter, guides – focuses – advises CEOs, presidents and business owners throughout the United States across a wide range of industries, to MORE success – MORE profit – less stress. Business people trust Howard’s vast business knowledge, practical advice, intuitive insight and objective perspective to solve business problems and issues. Get MORE from your business! Talk business with Howard: 888-738-1855.
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The post How Important Are Year-End Business Profits? appeared first on Talk Business with Howard.
