All businesses need to have financial stability in order to achieve long-term goals. Yet, most companies only focus on those long-term financial goals, leaving behind the steps to getting to that point. What types of short-term financial goals should your company have in place? Consider a few examples:
Clearly Defined Revenue Goals
A good place to start is with revenue goals. Create achievable goals for how much money your business will bring in over the course of a fiscal year. Your goals for the following quarter or month may be to increase revenue by 10 to 20 percent, depending on your market.
Create a Comparative Analysis of the Competition
It may not seem like a financial goal, but understanding how well your competition does can provide an opportunity for you to adjust pricing, offer additional products, or alter advertising to reach a larger audience that you could be missing now.
Determine where the biggest opportunity cost is within your expenses. Then, if possible, find a way to reduce it slowly over time. Don’t expect instant results. Yet, decreasing costs should always be one of the financial goals your business has. Every penny saved is another that can be put towards growing your business.
Improve Financial Margins
Working to increase your company’s profits by focusing on your margins. Focus on areas such as overhead expenses as well as the production process. Consider testing different price margins, as well.
Work to Manage Debt
Another example of a short-term goal is to work on debt management. First, create a plan to stop adding to existing debt. Then, work to find a way to reduce your existing debt in a stepped process over time. Your end goal should always be to eliminate the need to use debt, which also requires building capital.
Get a Better Level of Control Over Cash Flow
Managing cash flow is a difficult area for most companies. Yet, cash flow planning provides an opportunity for your business to manage expenses, unexpected costs, and debt better.
Build Your Business’s Financial Stability with Guidance and Support
Allow the team at Sterling Financial to help you build your business’s financial health. Talk to our team about your long and short-term financial goals. Let us put you on the right path forward.