It’s currently 8:30am on the 31st of December, 2010. Today is the end of the workweek, the end of the month, and the end of the year. I’m finding myself simultaneously excited and terrified about the new year, and I’m willing to bet I’m not alone.
The past few years have been quite a rollercoaster, especially for business owners. For me, this was the first year I worked exclusively from home. It has been a strange adjustment, but overall one that I enjoy. As I was making plans for 2011, I came up with 5 reasons business owners might be dreading 2011 (and maybe some solutions).
5 Reasons You’re Dreading 2011
1. 2010
Problem:
Most people are judged, sometimes unfairly, by their last performance. Fumble the ball in the Super Bowl? Get caught lip-syncing at your last concert? See sales drop 15% in 2010?
Many of you are looking over your books from this year, and the news isn’t good. You saw a decrease in sales or an increase in your costs, and you’re worried that the trend will continue next year.
Solution:
There are a ton of business clichés I could use right now. In the end, the simple fact is that nobody can predict the future accurately. You can, however, study the past. Go over ALL your records. See where things fell off the rails, and make a solid plan to address those issues this year. If you plan properly, you only need to make a mistake once, so there’s no reason to think 2011 will be the same.
2. January is the “Slow Season”
Problem:
For many businesses, January is the time when you see more customers returning bad gifts than buying new ones. It’s always been the worst month of the year, so there’s no reason to believe it’s going to change this year.
Solution:
Step outside the box and look at new products or services you could offer, preferably ones that complement what you’re currently offering.
If you sell products, why not offer training?
If you offer a service, is there a product that your clients are already buying from someone else? Why can’t you be the one they buy from instead?
Who bought from you last January? Why not reach out to them early with a special offer?
Get on Twitter, and search for people who are asking about your industry. Maybe they’re having trouble with something you sell or in an area you have expertise. The advice you give will be free, but they may turn to you the next time they need to buy.
My only other advice here is to avoid the “Everything Must Go!!” style sales to bring in customers. Sure, you might get more sales, but at a lower margin, which means no more money at the end of the day. It also trains your customers to only shop at your store during a big sale. This makes it hard to convey your unique value because people looking for a deal see price, not long-term value.
3. Cash is tight from Christmas
Problem:
Maybe you’re a sole proprietor who just took a bit out of the business to make sure the kids had presents under the tree. Perhaps the last of the Christmas bonuses you gave your employees just cleared the bank account. Either way, money is tight, and it’s got you stressed out.
Solution:
Your first instinct might be to get a loan. Try to resist this urge! You will be fixing a short-term problem with a long-term one.
First, try some of the advice in #2 to bring in more sales.
Next, cut down your cost and tighten up your cash flow. Check out this article for tips. This is not the time to buy new equipment or “treat yourself” to a new suit.
Finally, if you have to sell things at a discount to boost cash, try doing it in a different channel. Sell some of your stale inventory on eBay, Craigslist, or Kijiji. Even if you sell them under your company name, doing it this way psychologically distances your business from a customer base solely interested in the best price. If you are an army of one, maybe find some personal items to sell off. If you’re going to get a loan, who better to loan you the money than you?
4. Taxes
Problem:
January always reminds us that tax season is approaching. For me, that’s good news because I’ll be getting a lot of requests for tax preparation. Most people don’t have that same excitement about tax returns. You just realized that your books aren’t balanced, and your receipts are scattered across your office (and coat pockets, glove box, and gym bag…).
Solution:
This sounds like a great time to hire a bookkeeper!
Alright, I’ll admit, that was a bit shameless. But, if you did, that would help me wipe out problems #1-3 in one fell swoop.
Seriously though, a bookkeeper will certainly help you get all of your books in order. They can also point out expenses you should be claiming. If cash is tight, and you don’t want to hire some help, there are other options.
I recently wrote a post, 5 Ways To Get Organized in the New Year. Following those steps should help get your books in order. The main thing is giving yourself enough time. Don’t wait until the end of April to start. If things are a bit quieter at the shop in January, then spend some of that time getting 2010 in order. There are always missing receipts, or confusing entries that you’ll need to investigate. Take the time now, and you’ll be glad you did.
5. Resolutions
Problem:
You’ve been putting off 12 different projects because you know you’ll “handle those in the New Year”. You’ve also promised yourself to stop all those bad habits that made 2010 the mess that it was. Now the calendar says it’s time to start, and you’re discovering you may have resolved to do more than is possible.
Solution:
Reign in your resolutions! There’s a good article over at The Simple Dollar about this. Basically, it talks about making one resolution. I would suggest you make one personal resolution and one for your business.
Be sure to make it realistic but challenging. Although “I’ll make a billion dollars this year” is a bad idea, so is “I’ll start jogging once….in a while”.
Look at 2010, and see where you need to improve. Figure out a realistic strategy to solve this problem, and plan to work towards it for the entire year. If you can achieve your goal by January 10th, you’re not setting the bar high enough.
Sure, there’s a chance you’ll come up short. There’s always that possibility. The only real failure is if you don’t keep working at it. If your goal is to boost profits by $10,000, you may only reach $5,000. But guess what, you just made an extra $5,000 in the process.
I know we’re all thinking about at least one of these going into the New Year. I know I’ve been thinking about all 5 quite a bit lately. Make sure to take some real time to sit down and plan out the year. I know the holidays are chaotic, and everyone is trying to pull us in different directions. Just find as much time as you can. Sit down in a quiet room, with a cup of coffee, some good music, and think about December 31st, 2011.
What do you want to remember from 2011? How do you want your business to look? What did you accomplish, and what are you most proud of? Now, how do you get from here to there? Once you’ve got your roadmap, you’re that much closer to success.
Good luck, and Happy New Year!