From the economy to customer behavior, many variables could impact your business’ viability in the future. Learn how to look around the corner to what’s ahead.
Your Business Resolutions for 2019
With a week of the New Year under our belt, it’s time for a brand new you: You’re going to call your mom. Take more pictures. Spend less time on electronics and more time outside. This time next year, you want the number on the scale to make you feel a little less like a sumo wrestler.
We get it – and we believe in you!
But your New Year’s resolutions shouldn’t stop there. This is also the perfect time to reevaluate your business and make sure you’re set up for success in 2019.
Sound daunting? Don’t worry, we’ve already done the hard work for you. Here is your list of official business resolutions for the New Year, along with some helpful resources from the Kinesis blog. Repeat after me:
We resolve to position our company for market shifts.
We recently sat down with Ken Tomita, Co-Founder and CEO of Grovemade – a producer of wooden iPhone cases. He told the story of his company’s meteoric rise in 2010, when Grovemade went from a small design shop to a multi-million-dollar business seemingly overnight.
But rather than putting their feet up and relaxing amidst all this success, Ken had the wherewithal to realize this would be short-lived – and they made the difficult decision to move away from their highest-demand product. This move turned out to be the right one: when iPhone sales dropped significantly in 2016, Grovemade was already positioned to rebuild the business toward non-Apple products.
This is just one of any number of market forces that could impact your business’ future viability. Whatever the potential market shift in your world, resolve to anticipate how these changes could impact your business, and act now – even if (and perhaps especially if) business seems to be going well.
We resolve to become attractive to a potential buyer (even if we don’t plan on selling)
We’ve talked a lot about mergers and acquisitions this year. This is because Kinesis often works with business leaders undergoing such a transition – either purchasing a business, or trying to position their company to sell. But even if this doesn’t apply to you, the same principles apply: the true value of a company lies outside of just the P&L.
For starters, it lies in brand loyalty. Can you imagine going out of business and your customers being so outraged that they drive hundreds of miles and flood stores to capture the very last of your product off the shelf? That’s what happened to Twinkie in November of 2012. The result? The company was purchased out of bankruptcy by investors who knew the value of a loyal customer. You may not have the same kind of brand fanatics as a sugary, heart-clogging snack, but your marketing strategy will still play a key role in the valuation of your business.
Marketing isn’t all, though: Company culture is another major contributor to the valuation process. Consider BerylHealth, a patient call center which was almost sold to a private equity firm in 2010 for 9x their EBITDA. Former CEO Paul Spiegelman ultimately ended up walking away from that deal, but decided to double down on company culture in an industry known for low morale and high turnover. Just two years later, Paul was approached by a different company interested in purchasing the business for 22x their EBITDA. Investing in culture more than doubled their valuation – and to quote Paul, “There’s no question that culture allowed us to sell the company for a premium price.”
We resolve to set a marketing budget… and then measure its ROI.
We spend a lot of time talking about marketing budget best practices, in part because many of our clients are devoting formal resources to marketing for the first time. So, if you’re a frequent reader of the Kinesis blog, you’ve probably heard us mention the importance of building an annual budget, industry benchmarks for building it, and the best way to allocate your resources. In fact, we’re not shy about sharing what we ourselves spend on marketing, and where those dollars go.
If you’ve already set a marketing budget for 2019, congratulations! You’re already ahead of the pack. Your next task will be to make sure you’re focused on the right marketing activities so that those dollars can go as far as possible. You do this by measuring the success of your marketing efforts based on the business goals you’re looking to achieve. This is important, because it’s easy to get seduced by trendy marketing tactics that may have no relevance to your business.
We resolve to Think Big with inspirational blogs, books, and podcasts.
We’ve included a few links to our favorite Kinesis blog posts here, but your big thinking shouldn’t stop there! Podcasts are also invaluable for business leaders to further personal development. They have grown steadily in recent years, and it's no wonder – podcasts are an easy, efficient and affordable way to learn. Doing chores? Commuting? Powering through your daily workout? Simply press play. We’re big fans of podcasts – in fact, we recently put out a list of all our favorite podcasts for growth-minded leaders.
If you’re not a fan of podcasts, though, there are plenty of other ways to grow your professional acumen in 2019. This past Thanksgiving, we compiled some more resources to inspire leaders – this time going beyond podcasts to include books, blogs, and other resources focused on defining your remarkable business identity. So if you’re looking to jump-start your business game in 2019, check out these other valuable tools.
While we can’t make any promises about the number on the scale next year, we can guarantee you this: With these resolutions in place, your business is sure to have a prosperous and profitable 2019.