By James Monroe—
Large companies regularly set goals to keep everyone focused and on the same page. But what about small businesses? Are goals really that important? After all, isn’t the number-one goal of most small businesses to make more money?
Well, yes, that is the long-term goal. But what about the shorter-term, milestone goals you need to reach the larger goal?
Large companies regularly set goals to keep everyone focused and on the same page. But what about small businesses? Are goals really that important? After all, isn’t the number-one goal of most small businesses to make more money?
Well, yes, that is the long-term goal. But what about the shorter-term, milestone goals you need to reach the larger goal?
Why You Need Goals
Short-term goals for your small business are important because they provide a way to measure success, guide decision-making, and keep people accountable.
Take the goal of making more money. It’s a worthy ambition, but how do you do it? By increasing traffic to your website? By encouraging more customer referrals? By partnering with other small businesses? Or by lowering your costs, adding new products or doing more advertising?
Any of those approaches might help you make more money, but they may not all be practical or affordable. And even if they are, you can’t do them all at once. Short-term goals help you create a systematic, realistic plan to grow your business. And they work because, done right, goals help you stay on track.
The good news is that it’s neither complicated nor time-consuming to set short-term goals for your business.
Setting Goals for Your Small Business: Where to Start
Before you jump into goal setting, look at your company, your competition and your market by doing a SWOT analysis. This is a simple evaluation of your company’s Strengths, Weaknesses, Opportunities and Threats.
For example, if you run a barbershop, your SWOT analysis might look like this:
- Strengths: We have a large base of repeat customers, a convenient location with plenty of free parking, and the lowest prices in the area.
- Weaknesses: The client base is aging. The shop only has three chairs, making expansion impossible.
- Opportunities: We could add new services, advertise to attract more customers or move to a larger location.
- Threats: Our rent may increase next year. A large salon is opening nearby, and a price increase may drive some customers away.
That analysis should lead to some brainstorming. What could you do to capitalize on your strengths, overcome your weaknesses, make the most of your opportunities, and protect your company from threats?
For example, you could:
- Offer beard trimming and hot towel massages for an extra fee.
- Increase the use of your limited space by renting chairs to new barbers to work Sundays and Mondays rather than closing the shop on those days.
- Launch an advertising campaign targeting younger customers and stock a small fridge with sodas to appeal to them.
- Research whether moving to a new location would make sense.
Even though it doesn’t take a lot of time, a SWOT analysis can help you think strategically about how to defend and grow your business. Without this structure, it’s human nature to keep your head down and hope everything will work out rather than take steps to ensure it does.
Then, with the insights revealed through your SWOT analysis, you’re ready to set short-term goals.
Setting Goals for Success
Some goals are better than others. The best short-term goals have specific characteristics that make them achievable. Fortunately, there are frameworks to make it easy for you to write goals. One of the most popular is the SMART system. SMART goals are Specific, Measurable, Attainable, Realistic, and Time-bound.
So rather than setting a goal like “Get more customers,” think, “Create and promote a customer referral program by March.”
Continuing our barber shop theme, here are some of the SMART goals that might come out of our SWOT analysis above might include:
- Adding services
- I will research other barber shops to see what extra services they offer and what they charge for those services by Feb. 15.
- I will decide what extra services to offer, set prices, and order any equipment (e.g. towel warmers), and revise my signage and website by May 15.
2. Adding retail products
- I will check with suppliers for products that would appeal to current customers and make a list of potential retail products to offer by March 1.
- I will create a marketing plan for a retail product line by May 1.
3. Moving
- I will check the current lease for its expiration date and any termination fees.
- I will meet with a commercial real estate agent to tour available properties within a two-mile radius of the current location by Jan. 31.
- I will evaluate the costs of moving, including building out the new space and the cost of downtime. I will decide whether to move by March 15.
Goals like these flow effortlessly from the SWOT analysis. Then, by applying the SMART framework, your goals will be achievable.
Keeping goals specific and attainable will also prevent you from feeling overwhelmed by large, broad tasks. And making the goals measurable will provide you with that satisfying feeling of checking off a box on your to-do list.
Entrepreneur magazine recommends beginning each goal with “I will.” The logic is that starting that way leads you to a specific, measurable action. It will also prevent you from falling into the “My goal is to make more money” trap of overly broad objectives.
Too Many Goals? When to Stop.
The number of goals you have at any one time is up to you. Business consultant Bernard Marr recommends having about 15 goals at any one time and grouping those that are related. So financial goals might be in one group, goals relating to customers in another, and so on.
Keeping similar goals together helps you remember all of them and see how they work together.
After you’ve accomplished several goals, start the process again by compiling a new SWOT analysis and see what new goals come out of that process.
One final tip from Entrepreneur: Write your goals down and post them where you—and others—will see them. We can all use a little peer pressure to stay on track!
If better managing customer communications is one of your goals, check out the Index by Pinger App. And for more tips on starting and running your small business, visit the Index by Pinger Small Business Resource Center.
