237: How To Do a Year End business Review
Summary:
Where did 2021 go? 💨 The year is almost over so it’s time to sit down and reflect on what went right, and what could have gone better. We discuss how to conduct a year end business review. One of the biggest factors is your mindset going into it. We break down the 5 categories you should investigate for your business and how to grow from each of them. Then, pet business coach Natasha O’Banion answers, “How do I get started with subscription boxes?”
Topics on this episode:
Why do a review
Getting set mentally and emotionally
5 major categories
Done, now what?
Ask a Pet Biz Coach
Main takeaway: You’re trying to make your business better and recognizing that you’re always growing, changing, and learning new things.
Links:
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A VERY ROUGH TRANSCRIPT OF THE EPISODE
Provided by otter.ai
SUMMARY KEYWORDS
business, clients, year, people, services, pet, goals, money, hired, financials, year end review, marketing, confessional, questions, offer, learn, spent, products, important, review
SPEAKERS
Meghan, Collin, Natasha
Meghan 00:17
Hi, I'm Meghan Collin. And this is Pet Sitter confessional and open and honest discussion about life as a pet sitter. Hello, everyone, welcome to episode 230 737. Hello. We appreciate you joining us today. And also want to thank our wonderful patreon supporters
Collin 00:41
like Beth, Claire, Adriana. And Becky, thank you so much for contributing to the show and helping make it what it is.
Meghan 00:50
If you would like to learn what it means to support the show with the price of a cup of coffee every month, you can do so at petsitter confessional comm slash support. So right now we are in December, the end of the year, it kind of flew by I don't know what happened. Well, I think it's because everybody was so busy, and we're continuing to be busy. And that's great,
Collin 01:10
never really took our foot off of the gas, it just kept growing and building for a lot of us. And so we are going to talk about a year end Business Review, it's a really great time of year to just take one moment to step back to think about how the year went. Because it really brings to mind a quote by Maya Angelou, if you don't know where you've come from, you don't know where you're going. A review really is taking a holistic view of your business over the last year and seeing what actually happened. It's taking about to just look up from the grind, look up from those daily tasks and think big picture.
Meghan 01:47
And we've talked before about doing regular reviews, or quarterly reviews, at least half year reviews. We've talked about business introspection before, and just really looking at the big picture, like the 30,000 foot view and going is this working? Is this not working? What do I need to change. So if you
Collin 02:05
were doing those kinds of reviews throughout the year, nothing should be a shock when you do the year end review?
Meghan 02:11
Well, it'll make it a lot easier to you've done it in little chunks versus the whole elephant.
Collin 02:15
But a lot of people don't think about doing it throughout the year. If they're either too busy, I don't have the time for it, maybe they've never thought of that before, or it could be your first year in business. So you're just learning about these kinds of things. That's fine, that's great. This review is a time to look back at the goals you set for the year, and whether you've accomplished them or not,
Meghan 02:36
it's also a great time to really understand your financials as well. You can assess them personally how you're doing and then start to play out what you need to change in your business.
Collin 02:46
It's also a time to check in with your staff and make sure that you have the culture and support that you want for your business to be running the way you want it.
Meghan 02:52
So we're gonna break down the year end review. And it really includes separating yourself from the business. So like I just said, like a bird's eye view, it's wise to disconnect yourself emotionally by approaching the process with curiosity really want to learn more about what's going right, what's going wrong, and really come at it from a stance of wanting to learn more rather than fear and criticism.
Collin 03:14
Yeah, I think that's huge for many of us, because we haven't taken the time to look at our business before. So we may actually be afraid of what we're going to find, we may be afraid to look at those financials, we may be afraid to look at the kind of people that we've hired or the kind of clients that we have, or the money that we've spent. But if we're coming at this going, I have to look at these things so that I can't improve, I need to be curious about this. I need to know how my business is operating. So I can make well informed decisions. That's going to really set you up mentally and emotionally set you up well to continue the process, because you have to recognize that you're trying to make your business better. And that you're always growing, always changing and learning new things. It's okay to learn. It's okay to admit that the year wasn't the way that you wanted it to run, it's okay to admit, you know, things now that you didn't know at the beginning of the year. That's growth, that's progress. And that's what we want.
Meghan 04:09
It's important to go into this process with a positive mindset and look forward to the results because no matter which way it goes, you're about to make it better. That's the great thing. learning, growing changing. That's what this is all about. A proper year end review is not done in one afternoon. I mean, I guess it can be if you're like really focused, and you have a lot of time, but this is really a deep dive into your business, your values and your goals. So keeping the pace is important. Schedule time slots each day during one particular week. If you have that kind of time, your your needs may dictate more or less time depending on what you find in your business, but don't shortchange yourself, you know, you, your company, your clients, if you have staff, they deserve this time and attention because everybody wants to make your business better.
Collin 04:58
Well, and we do 10 To focus and plan for the future, as business owners as entrepreneurs, we always like to look ahead. But rarely do we give a critical eye to the past. Meaning that what we're doing is we're stunting our ability, we're limiting our ability to learn from our mistakes, and lean into our strengths. So that's why we set this time aside to do the business review to do the urine review, to lean into those places where we need to grow and learn from, so that we can continue to look forward and hope for better things.
Meghan 05:29
So let's get into it, there are going to be five major aspects that we're going to look into. First one is financials and sales, and then human resources and culture, major projects and initiatives. Fourth one is marketing. And then the last is goals and opportunities. So basically, there's going to be a lot of questions that you're going to need to ask yourself in your business so that you can figure out how to make it better. Yeah, and
Collin 05:52
there's no right or wrong answer through any of these questions that we're going to dive into. This is up for you to decide for you or your business partner, or for you to take to your staff so that you can decide how the business is running and whether you think it was a success. So the first one we'll talk about are the financials. Obviously, this is a big one. This is what most people think of when they think about doing a year in business review. And we're really looking at two major buckets here. If you're just getting into this, you looking at a profit and loss, and you're looking at your cash flow. So the profit and loss is just what you made, and what you spent for the entire year for the entire business. I'll also recommend that if you offer alt, if you offer different services, or and you have a variety of things that you let clients Choose and Book for you do a Profit Loss for each one of those, how much did it take you? How much money did you spend offering dropins? Versus walks? And how much did you make from each one of those, when you break it out? For each service, you're really going to see a lot of powerful things come where you are going to make decisions on where you want to invest in where you're growing versus where you're not. I know a lot of people may offer boarding or daycares in their homes as a way to supplement their other income. But you may find that you're actually losing money on those on a per hour basis. And they're not actually worth it for you given the amount of bookings and hassle and trouble that you have, then you're going to look at your cash flow. Your Cash Flow is really just simply the money coming in and flowing out of the business. What are you spending money on? What are you making each month and then again, that profit is what you've made above and beyond that. So if you find your you're struggling paying bills, if you find that you're having trouble staying up to date on invoices or things like that, the cash flow statement is really going to help you understand what exactly is going on. Where are the bottlenecks in getting paid where the bottlenecks in the services and pricing and things like that, that you're struggling with for your business. And you can use a software that's really simply we use Wave apps.com, it's a free version. It's free, kind of very similar to things like QuickBooks, but you can get those or you can do other things. Having a software will really help. If your financials are really simple, you can just use a simple spreadsheet or Google Docs to work out these numbers. But sitting down and this will really take probably the most amount of time is getting everything set up. And then answering some of these questions.
Meghan 08:15
If you started selling products this year, I know a lot of pet setting businesses did and worth thinking about getting into that as well. But which ones sold better than expected? Which ones sold worse than expected? Which ones were customer favorites? Which were they not interested in at all? It's important to look at these things. Then also what sales channels generated the most revenue? Was it Facebook, Instagram, particular ads that you took out whether on radio, newspaper, magazine, or digital ads as well? Or was it word of mouth
Collin 08:47
and where this really again comes to the powerful understanding of what services or products generate the most money and what was worth it versus what was spent on that you may have a goal of increasing pack walks because you can make more money for each time period because you've got more dogs on there. However, it may be hard to time those and coordinate those. Or you may be finding that you're spending a lot of money advertising to fill in some slots, and it's just not paying off in the end, because you're spending all this money to advertise. But per slot, you're not actually getting that back or at the end of the day. So asking these questions can help you decide which services or as Megan mentioned, which products to focus on and which ones may not be worthwhile to stick around.
Meghan 09:29
The second bucket of questions to ask yourself is in regards to human resources and culture. So if you don't intentionally build a company culture, it will likely build itself for you. And you probably won't like the results. I mean, even if you're flying solo a lot of solopreneurs. Having a well defined value system or mission statement offers you a roadmap to your success. So what did you do this past year to cultivate a positive culture? What opportunities were missed? How will you be even more intentional about it in the new year.
Collin 10:03
If you have staff, it's a hard question. But now's a good time to ask it. Who do you need to fire? Who is it time to let go and let them move on? Or maybe you're looking to staff up and looking at other positions around you. So what areas do you actually need to hire more people are get help with and asking these questions about what was I intentional about sometimes that is hiring people, sometimes that's firing people, sometimes that's offering different incentives to the people that you have hired, sometimes it's letting them know that they can contribute and giving them access to materials to allow them to use different skill sets and tools that they have different passions that they have, and invest that into the company. So they can help build the culture, they can help build the company, the way that would help them as well and make it more attractive to other people like them.
Meghan 10:49
Or I know there was a lot of talk this year about finding good staff and actually retaining them because the job market is so different than anybody thought it would be this time this year. But maybe look at where you placed your job ad the exact wording that you used in there, maybe you need to change it up, maybe you need to put the job ad somewhere else. Or if the free version wasn't working, go pay for it, maybe you'll find different people on there as well.
Collin 11:15
Yeah, it's a good time of year to recognize maybe I made a mistake hiring. I hired too fast I hired too quickly. And because I just felt the rush to get somebody on board. If you did that. Maybe it's time to let them go. Conversely, maybe made that really golden hire a few months ago, what more responsibilities? Can you give that person? How can you help that person feel more valued and more invested in the company? You only only you know the answer to that and what you're able to do and what you're capable of, but start thinking about ways to retain these people who are really valuable and hard to find.
Meghan 11:46
We talked about staffing, and that typically has to do with growth. So the third thing we're going to talk about is major projects and initiatives. So did you expand into a new area? We did? Did you? Did you start selling items? Did you offer a new service? Or did you rebrand this year? How are those going? Did you enjoy that process? Were there things that could have gone better? Are you happy with how it turned out? Or do you still want to change some things? What is working within each of those and what's not? What did you try this year in order to grow or improve your business? All of these are experiments, there projects that you need to analyze before next year so that you can have an awesome 2022.
Collin 12:31
So just the example of rebranding, maybe you rebranded this year, I know a lot of people did that worked on it, they launched it this year, ways to assess this, are you getting the clients that you want? Are you getting the amount of frequent referrals? Are you getting the kind of personnel? Are you getting the kind of messages that you would like to have for the rebrand? Is it matching up with a company culture that you have asking these questions, not just of yourself, but it sent out some polls, to your staff to your clients and ask them? Are they happy? Are they jiving with the messaging that you're putting out there? And is it consistent? That way you can judge the ways to improve for next year so that you can continue to make it work
Meghan 13:14
for you. Or maybe you partnered with a local rescue or a local pet business that you guys were sharing social media posts
Collin 13:22
or doing in person meet and greets or going to community events with? Is that still something you want to keep up? Are you both happy with those kinds of relationships that you've built? One area that we were also always concerned about and interested in? How it's going is is marketing. So where did you invest money last year, this includes things like marketing, maybe did some research and development, ask people maybe you developed a project or you bought new equipment. When it comes to things like investments, especially marketing investments, it's crucial to analyze your return on that investment. In all the ROI, all that return on investment means is the money that I put into the system was that more or less than I get back. And one really simple way to understand how our marketing is going is look at where your new clients are acquired from and how they found out about you. If you're not already, always ask new clients and write it down. Not just ask them but put it somewhere. How they found out about you. Was it a referral? If so, prod them and ask them who was it that told you me told you about me? Did they find out through a Facebook post or a Google My Business search listing was it through some other means that you're out there marketing on that way you know what you can lean into and that way you can know how your advertising or how your time and investment is actually paying you back. You can also look at your new clients versus your percent repeat. And this is totally dependent on everybody in everybody's market because it's different for how we run our businesses and around the services that we offer. But the service industry on average is roughly about 30%. So you'll have about 30% repeat clients. That means that when you look at your entire client list 30% come back to you. If yours is lower, and you're not making the kind of money that you would like, or it's not as predictable as you would like, lean into servicing the ones that do come back to you, so you can lock them in, and that you can help make them have a better experience every single time. And then start sending out more direct communications, email, direct mail, whatever to your entire list of clients, to stay on top of mind, to entice them to come back to remind them that you're there. And that they'll maybe come back and use you.
Meghan 15:33
It's also a good idea to look back through your client list and figure out which ones are good, which ones maybe didn't treat you so well. And then cut the ones that didn't treat you. So well cut the bad ones. Also, which ones are making you the most profitable, giving you the most money each year. I know Brian Taylor, the dog father had talked about that he goes through his client list every few months, and basically cuts out the last the bottom half, like the 20%, or something at the bottom that are not making him as much money. And he focuses on the top ones, the ones that the clients that buy the packages, and really support him financially very well,
Collin 16:13
the repeat clients. So he's trying to boost his percent re clients that are returning to him by getting rid of the ones that don't. And what that does is it makes more room for new clients who you can potentially move up into being more repeat clients and using your services more often.
Meghan 16:29
So cut out the ones that don't respect your boundaries, the ones that you don't like to work with. It's not worth it and focus on the good ones, the ones you want to retain. If you went to pet friendly events this year, how did those turnout? Did you get the participation that you wanted? did enough people sign up for your email list? That's what we know cars did not
Collin 16:50
do? Well, so that's a good point is if you did that, start asking questions about that event. Should you have had more things there? Should you have been out walking around talking to people? Should you have had a banner?
Meghan 17:03
Should you have been there at all?
Collin 17:04
Yeah, should you? Oh, yeah, exactly. That's always an option. Maybe it's just not worth your time and investment in all the things that you have to bring to make it pay off.
Meghan 17:12
When you talk about marketing. I also think of your branding, and maybe the shirts that you wear. So we invested in new shirts this year, that on the front side, in big bold letters petsitter. And so we got a lot, I feel like that really worked well for us this year, we got a lot of questions of are you a petsitter? Or
Collin 17:30
is that real? Given? Yes. And then outcomes, the business card? And oh, good explanation. It started a lot of conversations.
Meghan 17:36
Yeah. So look at your logos and your branding and all that stuff as well. And if that's working for you, great. And if you want to change some things, then figure out what that is. We've been saying that this is a 30,000 foot view conversation. So we need to look at our goals and our objectives for this past year. What were your achievements? What happened that you were excited about this year? What goals did you reach? And how do they impact your growth? I know one of our goals was to double our income from 2020, which wasn't that hard to do, because of the way 2020 went, but we definitely did that we very much exceeded that. And so that has been great. We've gotten a ton of new clients, and 2021 has been really good to us.
Collin 18:22
It really adds so things like Okay, does that happen to us? What did we learn from 2021? And how did it support what we were doing? Well, we learned a lot about how to how to scale quickly how to intake a lot of new clients field requests, we got, we started to get back into the game of seeing a lot more red flags of what wasn't going to work with us. So we started writing some of those things down or putting them in our employee handbook, which we later used to bring on some staff members. So it's taking these things that we learned these lessons that we're learning, and then putting them somewhere you whether it's just a quick notes document, you've got to write that down, because it will be beneficial to you at some point in the future.
Meghan 19:02
Well, it's also just great to celebrate your wins, right? Like if you're having a bad day, if something happened with a client that you weren't happy about, or they weren't happy about and they came to you and talk to you. It's great to remind yourself of those little wins. So but it's also important to note your biggest disappointments as well. So what were some things that did not go well did not go right for you and your business in 2021.
Collin 19:25
Well on on disappointments for this past year, I will take you back. I think for me, one of the biggest disappointments of the year was that community event that we went to I was really excited about going to our first one with our new logo with our branding with our T shirts. And it was just a total and utter flop. And so it was a big lesson for
Meghan 19:43
us. So and it wasn't necessarily our fault either. It was there was a lot
Collin 19:47
of things about the event about the organization that we had no control over that we didn't know about ahead of time. So now the question is now that we know about that, what is in our control what is out of our control and how do we better be prepared for it next or not. And on the goals that you're talking about, you need to identify which ones are worth keeping. Look back over the last year, are there any ones that we want to keep around, or maybe we need to get rid of some offload ones that either are no longer relevant ones that we've accomplished already, or ones that don't quite fit what we're wanting to do. And then how will we redirect not just my energies, but the people around me to have a better desired outcome. But I will caution, don't be hasty in ridding you or your team of worthwhile goals that didn't pan out. Just because they didn't happen this year doesn't mean they aren't achievable. Next time. Instead, look at other avenues that you might take to achieve them. Your new list of goals should include long term and short term goals.
Meghan 20:45
And then once you've completed your review, and your whole planning process, like we said, In the beginning, schedule a monthly or quarterly block of time to perform many reviews. And that way, you don't have to do a whole big, long, somewhat scary review, at the end of going, oh my gosh, I don't know where the year went and what actually happened over the year, you can get it in small chunks instead, and write it down in a Google Doc, or Word document. It's it's a living, breathing document, make changes as your year goes on. Note your wins, like we just talked about and continue to celebrate them.
Collin 21:19
And that really is something that I know we can get a lot better at is that those periodic check ins with our business. And I will say it's not just that it's stay easy to stay up to date. It's because it really helps you make small course corrections throughout the year each time, instead of having to do this major overhaul. Once a year, you'll build up your anxiety, it's harder to make, it's harder to turn the ship 180 degrees all at once, versus 10 or 20 degrees each time as we're trying to navigate these waters, that is running a business in pet care
Meghan 21:53
if you do a year end review. What do you include in there? Are there some of the things that we talked about today? Or are there completely different things that we didn't even think about? Probably that one. But let us know on Facebook or Instagram at Pet Sitter confessional. We have a Facebook group with a ton of other pet sitters in it. It's called sitter confessionals. Or you can give us a call 636-364-8260. We love voicemails.
22:19
Yeah, there's still another phone number.
Meghan 22:23
On today's segment of Ask a pet biz coach, Natasha opionion is going to answer How can I get started with subscription boxes?
Natasha 22:30
Yes, the subscription boxes is a recurring revenue stream and is a product base. So you can model it on different ways. The way we do it is it's called a surprise box. So we get to pick different items each month to give our subscribers they don't know what it's going to be. We shop local and we shop afar. And we just give them a variety of things, you know, human and pet related, they really enjoy the box. I mean, you guys have seen him BarkBox has there's become box has theirs, everybody has their rendition of it. But I really like giving human and pet a little bit of something in our boxes. So it's something you put on recurring revenue, you can easily get a company to make you your own design. I personally use dogs design, I've been using them for a while now. And once you have the box ready and you have your subscription members, you literally just package it and send it out. It's not a big, you know, not a big hangover on that one.
Collin 23:26
I think when you start moving into more products base, and that's where a lot of headache or concern or anxiety comes from because we feel like we're managing things or we know we're shipping and having to deal with products and stock. But really sounds like that's not a huge weight on your shoulders. At least
Natasha 23:41
No, I wouldn't say shipping and receiving is any different than an average day on a holiday. You know, like we've done, we've dealt with way worse. I've seen businesses get way more chaotic than going to the post office and sending a box. But it's also something you can offer your teams if you want to offer more hours. That's always something that I send back to them hey, we have boxes now I want you to help me do some market research. I want to help I want you to help me find some new items that are on on the market or things that our clients would enjoy. You know, they always love the tumblers. They always love T shirts like always love journals, new pens, you know things that you think the owner would actually enjoy? Because the thing is we spoil the dogs 24/7 But we forget about the humans. If you can show the humans inexperience you're going to keep that client forever
Meghan 24:32
Natasha is a sales queen and runs her own dog walking business. If you'd like to work with her on one on one you can do so at her website, start scale sale calm and use the code PSC 20 for 15% off. Thank you very much for listening today. And also thank you to our Patreon members for supporting us every month. Yes,
24:50
thank you so much. Get out
