How to Set Business Goals for a Successful Year
Follow this step-by-step guide to reviewing your business and planning for the year
Managing a design or construction firm can be time-consuming, particularly when you’re busy with several different projects, but it pays to take some time out to analyze your business and plan ahead. Here, a design-build firm director, a landscape design business owner and an interior designer share how they review their processes, customer service, marketing and finances, and set actionable goals to improve business success for the future.
Analyze Key Areas of Your Business
Take a deep dive into the previous year’s performance of your firm, prioritizing four main areas.
1. Finances. Profitability and cash flow are, of course, essential for any business, so make sure you cover this aspect thoroughly during your annual review. “I keep records of each project, the time spent and revenue earned, as well as the types of projects that work best for me,” Auzins says. “We review fees and costs, and work out if changes are needed.”
“We analyze profitability, evaluate individual project performance and examine trends in financial data,” says Alex Strikovs, managing director of design-build firm Home Republic. “This helps us understand what drives profitability and where to focus our efforts.”
Reader recommends doing an audit of all your outgoings. “It’s important to keep an eye on the functionality of key expensive tools, such as the computer and software, and to plan upgrades ahead of time,” he says. “I also review the ongoing relevance of regular outgoings, such as memberships and publicity payments, to ensure they’re still required and are delivering.
“Income is obviously also key and with [at least] nine months of income data in hand, as well as client numbers and types of projects, I can reflect on the balance and areas of income generation of the business,” he says. “From these, I can make informed decisions on my preferred work and my pricing model for the coming year.”
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Take a deep dive into the previous year’s performance of your firm, prioritizing four main areas.
1. Finances. Profitability and cash flow are, of course, essential for any business, so make sure you cover this aspect thoroughly during your annual review. “I keep records of each project, the time spent and revenue earned, as well as the types of projects that work best for me,” Auzins says. “We review fees and costs, and work out if changes are needed.”
“We analyze profitability, evaluate individual project performance and examine trends in financial data,” says Alex Strikovs, managing director of design-build firm Home Republic. “This helps us understand what drives profitability and where to focus our efforts.”
Reader recommends doing an audit of all your outgoings. “It’s important to keep an eye on the functionality of key expensive tools, such as the computer and software, and to plan upgrades ahead of time,” he says. “I also review the ongoing relevance of regular outgoings, such as memberships and publicity payments, to ensure they’re still required and are delivering.
“Income is obviously also key and with [at least] nine months of income data in hand, as well as client numbers and types of projects, I can reflect on the balance and areas of income generation of the business,” he says. “From these, I can make informed decisions on my preferred work and my pricing model for the coming year.”
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2. Branding and marketing. How you market your business will affect how many new clients you can attract over the year and who those clients are.
During its annual review, Strikovs’ firm looks at the company positioning. “We evaluate our market standing, analyze project types to assess progress toward strategic goals and monitor customer perception to understand our brand reputation and attract the right clients,” he says.
Says Auzins: “[My business adviser and I] also go over things such as the website, social media presence, Houzz and other ways of making my business visible to the clients I want to reach.”
Reader takes the opportunity to consider entering projects into industry awards. “The publicity raised through entering trade award schemes can be very helpful in getting new business, both in terms of drawing attention to your business and also giving potential new clients the confidence that you can deliver,” he says.
“With any new design, it’s always worth thinking about whether it’s worth putting it forward for an award,” he continues. “Thinking of this in advance can be very helpful as you can ensure much of the work of entry is done as you design the garden and photograph the result, rather than having to play catch-up later.”
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During its annual review, Strikovs’ firm looks at the company positioning. “We evaluate our market standing, analyze project types to assess progress toward strategic goals and monitor customer perception to understand our brand reputation and attract the right clients,” he says.
Says Auzins: “[My business adviser and I] also go over things such as the website, social media presence, Houzz and other ways of making my business visible to the clients I want to reach.”
Reader takes the opportunity to consider entering projects into industry awards. “The publicity raised through entering trade award schemes can be very helpful in getting new business, both in terms of drawing attention to your business and also giving potential new clients the confidence that you can deliver,” he says.
“With any new design, it’s always worth thinking about whether it’s worth putting it forward for an award,” he continues. “Thinking of this in advance can be very helpful as you can ensure much of the work of entry is done as you design the garden and photograph the result, rather than having to play catch-up later.”
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3. Client relationships. Good customer relations can really help to drive repeat business and build a reputation for you and your firm. So it’s a good idea to evaluate how your customer service went over the past year and set goals to make sure you attract the clients you work with best.
“We gather and analyze feedback, assess project-specific satisfaction and review customer relationships to ensure strong partnerships and identify areas where we can improve,” Strikovs says.
“Having a clear definition of my ideal client is essential,” Auzins adds. “We look at which projects have most closely aligned with this and how best to reach more of these.”
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“We gather and analyze feedback, assess project-specific satisfaction and review customer relationships to ensure strong partnerships and identify areas where we can improve,” Strikovs says.
“Having a clear definition of my ideal client is essential,” Auzins adds. “We look at which projects have most closely aligned with this and how best to reach more of these.”
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4. Time management. A review of last year’s scheduling and organizing processes will help you set efficiency goals for the year ahead. Auzins, for example, analyzes the best way of using her own time versus delegating, and how to make that most efficient.
“Take a moment to think through your business and design processes,” Reader advises. “Is there a template or a resource file that you’ve been meaning to make or update that would significantly speed up your work flows and reduce that frustrating repetition of simple tasks? Making this part of your business review of the past year will help you prioritize it among pressing client work and, in the long term, really help you. These things are all too easy to put on the back-burner.”
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“Take a moment to think through your business and design processes,” Reader advises. “Is there a template or a resource file that you’ve been meaning to make or update that would significantly speed up your work flows and reduce that frustrating repetition of simple tasks? Making this part of your business review of the past year will help you prioritize it among pressing client work and, in the long term, really help you. These things are all too easy to put on the back-burner.”
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There are templates built into many of the Houzz Pro tools that can help boost efficiency. The Estimate Builder, for instance, allows you to quickly produce detailed quotes, while the Schedule feature enables you to make clear, shareable templates of project processes that you can use again and again to organize your and your team’s workflow.
Auzins says she meets with her Houzz account manager several times each year to discuss how to use Houzz Pro to its best advantage.
Learn more about Houzz Pro software
Auzins says she meets with her Houzz account manager several times each year to discuss how to use Houzz Pro to its best advantage.
Learn more about Houzz Pro software
Focus on Both Positives and Negatives
Once you’ve had a detailed look at those key areas, take a step back and review the ups and downs of last year.
“Looking at what went right is important, but also what didn’t work as well,” Auzins says. “This can be a promising client who turned out to be much more difficult than anticipated, or a project that developed unforeseen complications.
“While these can’t always be avoided, it’s important to put procedures in place to deal with possible irregularities ahead of time, and also to develop strategies to mitigate problems as and when they arise,” she says. “Being clear with clients regarding how unforeseen elements will be handled works for both sides.”
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Once you’ve had a detailed look at those key areas, take a step back and review the ups and downs of last year.
“Looking at what went right is important, but also what didn’t work as well,” Auzins says. “This can be a promising client who turned out to be much more difficult than anticipated, or a project that developed unforeseen complications.
“While these can’t always be avoided, it’s important to put procedures in place to deal with possible irregularities ahead of time, and also to develop strategies to mitigate problems as and when they arise,” she says. “Being clear with clients regarding how unforeseen elements will be handled works for both sides.”
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Envision the Bigger Picture
Now it’s time to look ahead and consider your goals for the coming year and beyond. Strikovs recommends carrying out a visioning exercise. “We start by collectively defining what success looks like for the company in the short and long term,” he says. “This includes identifying our aspirations, desired impact on clients and the community and any ‘big picture’ goals we want to achieve. This sets the stage for the rest of our goal-setting process.”
He then moves onto two more detailed types of analysis, identifying areas that could affect performance in the future. The first of these is SWOT. “We conduct a thorough SWOT analysis to identify our internal strengths and weaknesses, as well as opportunities and threats,” he says.
The next is PEST analysis. “[This examines] the political, economic, social-cultural and technological factors impacting our business environment,” he says.
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Now it’s time to look ahead and consider your goals for the coming year and beyond. Strikovs recommends carrying out a visioning exercise. “We start by collectively defining what success looks like for the company in the short and long term,” he says. “This includes identifying our aspirations, desired impact on clients and the community and any ‘big picture’ goals we want to achieve. This sets the stage for the rest of our goal-setting process.”
He then moves onto two more detailed types of analysis, identifying areas that could affect performance in the future. The first of these is SWOT. “We conduct a thorough SWOT analysis to identify our internal strengths and weaknesses, as well as opportunities and threats,” he says.
The next is PEST analysis. “[This examines] the political, economic, social-cultural and technological factors impacting our business environment,” he says.
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Make an Action Plan
Finally, it’s time to make an action plan. “During a company meeting, we analyze all the collected data, discuss implications and formulate our plan for the year ahead,” Strikovs says. “This includes breaking down each goal into smaller, actionable steps, assigning responsibilities and setting deadlines. This ensures everyone understands their role in achieving our objectives.
“This process allows us to make informed decisions, capitalize on opportunities and mitigate potential risks,” he says. “For example, two years ago, this analysis led to the successful introduction of our design and build department, which has become an integral part of our business.”
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Finally, it’s time to make an action plan. “During a company meeting, we analyze all the collected data, discuss implications and formulate our plan for the year ahead,” Strikovs says. “This includes breaking down each goal into smaller, actionable steps, assigning responsibilities and setting deadlines. This ensures everyone understands their role in achieving our objectives.
“This process allows us to make informed decisions, capitalize on opportunities and mitigate potential risks,” he says. “For example, two years ago, this analysis led to the successful introduction of our design and build department, which has become an integral part of our business.”
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Prioritize Life Balance and Well-Being
In addition to having business goals in place, make sure you also assess your workload and well-being.
“It may be that you are very busy and really could do with getting some help in delivering your projects,” Reader says. “Perhaps there is a particular aspect of design that you find hard or do not enjoy that another person could take over from you? Think carefully about what route of employment you might use to deliver this and consider discussing it with your accountant, as there are a number of ways of doing this, each with different financial implications.
“Another way to play it, if you’re fortunate enough to be too busy, is to practice saying ‘no’ to jobs that don’t really fit your business model,” he says. “When starting out, we’re all keen to do any job, but over time this can change. Remember, work-life balance is a very important issue to ensure you continue to enjoy your work and don’t get burnt out.”
Tell us: How do you plan for the year ahead? Share your thoughts in the Comments.
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In addition to having business goals in place, make sure you also assess your workload and well-being.
“It may be that you are very busy and really could do with getting some help in delivering your projects,” Reader says. “Perhaps there is a particular aspect of design that you find hard or do not enjoy that another person could take over from you? Think carefully about what route of employment you might use to deliver this and consider discussing it with your accountant, as there are a number of ways of doing this, each with different financial implications.
“Another way to play it, if you’re fortunate enough to be too busy, is to practice saying ‘no’ to jobs that don’t really fit your business model,” he says. “When starting out, we’re all keen to do any job, but over time this can change. Remember, work-life balance is a very important issue to ensure you continue to enjoy your work and don’t get burnt out.”
Tell us: How do you plan for the year ahead? Share your thoughts in the Comments.
More for Pros on Houzz
Read more stories for pros
Learn about Houzz Pro software
Talk with your peers in pro-to-pro discussions
Join the Houzz Trade Program
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When you’re juggling projects, managing client relationships and keeping an eye on your day-to-day finances, it can be difficult to see the forest for the trees. So it’s a good idea to plan a time for reflection to examine your business as a whole.
“A quieter time of year —acknowledging that it’s never completely quiet — can be the perfect time to review your business and goal setting,” landscape designer Peter Reader says. “Creating protected time to do it as a concentrated task can deliver coordinated and better results than relying on a hit-and-miss approach throughout the year.”
Interior designer Anna Auzins calls in an expert to help her review and plan. “I meet with a business adviser each year to go over how things have gone, and to make plans for the year ahead,” she says.
Reader adds that while a dedicated period at the beginning of the year is crucial for reviewing the business, you should be careful not to let everything build up. “It’s important to keep your eye on all these areas throughout the year and either make a note of them to roll into your annual process, or give them protected time if they’re more urgent,” he says.
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