Planning out your company’s annual financial projections could be one of the most important things you do for your success this year in your direct selling home based business.
Normally business professionals are so busy running their company that they often forget to take notice of what path their company is on. Making annual projections is simply establishing a clear path to follow.
You should know what is happening inside your company and in the industry with your competition. This helps you recognize problems and opportunities. Perhaps you’ll have already made a plan for the “what if this happens” type of scenarios.
So let’s look at what you might measure on an annual basis.
- Billable hours – hours that are spent on money making activity
- Prospecting – how much time is spent seeking and securing new business
- New accounts
- Retention of previous accounts
- Turnover and the reasons
- Proftability
- Gross Margin
- Sales Goals
- Recognition and awards (if your company does that as it usually ties to money making activity)
What measuring does, is it provides you with vital feedback and an early warning or problems.
- You can be official and set a rolling 12-month period by month – but this should be updated at least monthly.
- Long range strategic plan of 3-5 years. Then you start from today and make 12-month projections.
- Budgets – typically cover one calendar year. These can help you be consistent with your 12 to 36-month plan.
- Cash forecasts – cash flow is measured in stead of accounting profits. Timelines for this can be daily, weekly, monthly, etc.
You can tell who is serious about their business because they know what is happening with their income and their expenses and how it relates to their long term goals.
Much like the yellow brick road in Wizard of Oz, you must know where you are going to ensure that is where you have arrived.
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Much Success!
Have an outstanding day!!
Sara