There is no good strategic plan without a first hand question: “What are you trying to achieve?” Ah… the difficult question of business goals… Isn’t every businesses’ answer: increase sales? Probably, in a way. However, again, it’s good to start thinking outside the box and define those goals a measurable and quantifiable way.
So, you want to increase your sales, don’t you?
Lets build from here. Successful organizations select a goal that can be easily measured and quantified – meaning you have to pick a number – and stick to it. This can be as simple as a sales, revenue or profit number, or it can be expressed as a %.
Alright then, let’s get nuts, you want to increase your sales by 75%! Good enough goal? Not really…
You have to set a time horizon for your objectives. How much time are you giving yourself to reach that objective? A year, a month, a week, a day?
Your business goal is starting to shape up: you want to increase your sales by 75% versus the same period last year. Are we in business? No yet…
The most important rule that many business owners forget when setting objectives is the following: “Objectives must be attainable.” Consider your knowledge of your industry and your competitors. Is it realistic to expect your sales to almost double versus last year?
Let’s make that business goal a little more attainable and stick to it: you want to increase your sales by 10% versus the same period last year. Now run with it…
Sales are a very wide area to play with when digging into business objectives. I highly recommend to put a little more efforts and to use a little more precise measuring tool. Marketing 101, here are some ideas:
- % growth in units objective: This sets your growth in a given measurement (say, for example, number of units sold) against the same measurement from the same period last year.% growth in revenue or profit objective: This works the same way as % growth in units, only you substitute the number of units sold for your revenue or profit.
- Sales variance objective: The number of customers buying from your website or brick & mortar location. Can be expressed as a number or %. Sometimes referred to as customer count.
- Spend per customer objective: Defines the dollar amount spent per customer in a single transaction. Can be compared as a number or % against prior period results.
- Revenue or profit per square foot objective: This objective demonstrates how efficiently you are using your physical space vs. prior time period.
- Closing ratio objective: Number of sales obtained versus the number of offers or quotes tendered.
Don’t hesitate to toss numbers around and see which ones make the most sense with your own development strategy. A marketing consultant can help you define business objectives so never hesitate to ask.
Next week, we’ll look at how to use those business objectives and turn them into marketing and social media goals.
How do you set your business goals? Which are your favorite key numbers? How often do you take the time to stop and look at them?