It happened. We’ve almost reached mid-January. That means we’re no longer just starting 2022. We’re in 2022.
If you’re like us, you’ve spent some time marveling over the nature of the universe and how quickly (or slowly?) the years pass. But now you’re probably looking ahead toward the rest of the year, gingerly gearing up for the adventures that might be waiting.
If you haven’t started your new year’s planning, now is the time.
But Fullbay, you might be saying, I just did end-of-year planning…do I really have to plan again?!
Well, yeah. If you fail to plan, you plan to fail and all that.
We accosted and pinned down Fullbay Director of Finance Robby Gilbert, who graciously took our questions and helped us put together a post that’s entirely devoted to setting you up for success in the new year.
A WORD ABOUT SWOT
If you’ve hesitantly googled start-of-year-planning, you’ve likely seen lots of chatter about a SWOT analysis. This is, unfortunately, not a team of highly-trained accountants who will descend from your shop’s ceiling, smash their way in through the windows, and handle all your financial stuff by force.
(Editor’s Note: I made Suz cut 500 words of the “SWOT Movie” storyline. You’re welcome.)
You can use SWOT to help you frame the way you think about your shop’s prospects in the new year. We’ve simplified it slightly, though you can see an in-depth explanation of SWOT right here.
In the meantime, put it to work for you by asking and answering the following questions:
- What are your shop’s strengths? Maybe you’ve got outstanding techs and equipment.
- What are your shop’s weaknesses? Maybe you only have two of those techs and thus are backlogged.
- What are your shop’s opportunities? Maybe now’s the time to hire a few more techs.
- What are the threats facing your shop? Anything that can harm your business is a threat. The parts shortage, for one. The dealership moving in across the street. You get the idea.
Your SWOT basically shows you what you’ve got to work with and what you’re up against.
Now, some companies spend days or weeks sorting out their SWOT. But unless you’re running a mega-shop, you can probably get through yours in a few hours, and it can provide a good baseline for the rest of your planning.
The next step in your planning is—brace yourself—usually a financial one.
TAKE A LOOK AT YOUR FINANCES
Even if you aren’t big on any kind of planning, you should still have some things in order. You have to pay quarterly taxes, after all, and are probably used to reviewing previous years and quarters, closing everything out, and prepping stuff for the accountant.
Robby suggested some specific areas to question when looking over your shop’s financial performance:
- Where did you finish the year financially?
- Are you ahead of or behind your expectations?
- Why did you finish up where you did?
- Some process you implemented or changed?
- Can you repeat this change, or fix it, if necessary?
And so on and so forth.
Now, Robby revealed to us that he does this kind of review every single month. But as we’re building this process around getting your year started right, we’ll suggest that you handle this particular review in January.
“The sooner you can close your book and look back and review where you ended up, the better,” he says, “ because if you’ve been doing something that’s making you fall behind in some way, you want to know that sooner rather than later.”
On the flip side, you also want to see what you did right to help you get ahead.
If you’ve been operating against a financial plan (or at least goals), compare your year-end numbers with those you hoped to achieve. Then close out those books.
DIG INTO THE NEXT YEAR
The past is behind you. The future is before you. You may already have a financial plan for the new year, but if you don’t, we’ve got a webinar to help you get started. (It’s for 2021, but you can apply those suggestions to 2022!)
You could look at it this way:
- What’s your earnings goal for the next year?
- How can you, as an owner, make that happen?
- Additional certifications?
- A triage bay?
- Hiring/promoting staff?
- How can you, as an owner, make that happen?
- Do you want to grow the business? By how much?
- How are you going to meet those goals in 12 months?
This is also the time to review W2s, 1099s, and customer contracts, among other things.
THE ALL-IMPORTANT FIRST QUARTER
Breaking down your overall yearly plan into bite-sized, dare we say quarterly chunks is kind of a series of stepping stones to success.
Robby suggests asking yourself the following questions:
- What are you going to do to make sure you hit your desired sales numbers by the end of March?
- What will you do to make sure your expenses are in line by the end of March?
If you haven’t already, now is the time to really consider what levers you can pull to increase revenue. Things like:
- Targeting a different kind of customer or fleet.
- Hiring additional techs, and/or getting them additional certifications.
- Growing your sales team to make sure you are reaching all potential targets.
- Boosting your marketing efforts, or maybe finally getting your shop a snazzy website.
MAY THE PLANNING BE WITH YOU
Planning out an entire year may feel like a lot of heavy lifting, but by breaking it down into chunks you can spare your brain and give your shop its best start at a bright future. Of course, the gang at Fullbay is here to help you (we bet we can make your new year even brighter—request a free demonstration!).
Above all, good luck in the year ahead! We’re rooting for you.