Sole traders: How to set and stick to your business goals in FY22
As a sole trader, there’s no better way to keep your business on track and help you stay motivated than to set business goals.
As a sole trader, there’s no better way to keep your business on track and help you stay motivated than by setting goals.
The lead-up to the new financial year is the perfect time to reflect on the previous 12 months, and decide where you want your business to be in FY22.
Jane Simpson, a highly-accredited and experienced brow artist and winner of Xero’s Australian Small Business of the Year in 2019, understands how challenging it can be to stick to your goals — especially when you don’t have a team to support you.
She went solo in 2015 after leaving her job of 20 years as a corporate relocation manager.
“Frankly, I was bored and I am not fantastic at being told what to do when it could be done in a better way.” she explains.
According to Xero’s Tipping point research — a report uncovering what makes sole traders decide to start something of their own — nearly 80% say dissatisfaction with their former job or career is a key driver to going solo.
Even though launching Jane Simpson Brows was the ‘best decision’ she’s made, Simpson had to navigate a steep learning curve when it came to making strategic plans. Tipping point indicates this is common for solopreneurs, with 48% claiming to struggle when dealing with the unknown.
But setting goals and making herself accountable for achieving them has seen Simpson’s business grow and thrive.
“Now before each financial year, I have a meeting with myself; I sit down and write down what I want to achieve.”
With Simpson’s help, here are some tips to help sole traders set, and stick to, their business goals in FY22.
1. Take time to reflect
It’s important to establish what you want to achieve early on in the new financial year — make your goals specific and attainable, but also set yourself a challenge.
Be sure to incorporate flexibility so you can pivot if unforeseen circumstances throw you off course.
Whether you lead a small team or are going it alone, you’ll find the support you need at Xero’s dedicated resource page — complete with free tools and guides to help everything run smoothly. Xero is online accounting software designed to let you do business beautifully and simply, nab a free 30-day trial today.
“I set myself an increased financial goal each year,” Simpson says. “I make them flexible enough in case the market changes or something that I thought was a great idea in fact isn’t.”
And while she doubted whether she would achieve her goals for FY21 after a three-month closure due to COVID, Simpson was among 22% of sole traders who thrived during the crisis, with her sales increasing by 40% on 2019’s results.
2. Formulate a SMART plan
Planning is the key to success, so ensure you define your goals as precisely as you can. A good way to help achieve this is by utilising the SMART method:
Specific: Define what you want to achieve.
Measurable: Quantify your goals and set deadlines for each.
Achievable: Set attainable objectives to help you stay motivated.
Relevant: Make sure the goal is suitable for your business at this time.
Timely: Plan carefully so your time frames are realistic.
Simpson believes it’s important to include both qualitative (client and/or personal satisfaction) as well as quantitative (financial or sales) goals in your plan.
“I’m a goal-orientated person so I love to tick off lists and feel that I’ve achieved something” Simpson explains. “But I also love the feedback I get from my clients in the form of reviews and word-of-mouth referrals.”
Formulating a strategic plan can help your business stay on course while keeping you accountable.
3. Track your progress
Setting deadlines will keep you motivated, and you can use OKRs — Objectives and Key Results — to keep your goals achievable.
OKR is a goal system – used by big businesses like Google but just as relevant to sole traders and small businesses – to create alignment and engagement around measurable goals.
There’s no ‘one size fits all’ when it comes to OKRs and flexibility is the key to success.
Work and project app company Monday.com has created a playbook for creating great OKRs, and it can be downloaded here. Monday.com’s resource outlines examples from different industries so you can get a good understanding of how OKRs apply to your business.
In the OKR framework, you start by setting a company objective, usually by quarter. This objective must be aligned with your vision and mission statements and be inspirational.
Your company objective might seem lofty, or even impossible to meet, but if you’re using OKRs you’ll follow up by ideating a series of key results (usually three to five) to get you there. The key results will be specific, measurable and challenging.
They’ll also be transparent — everyone in the business has the same “North Star” as Simpson puts it, and everyone can see the goals their colleagues are working towards.
When you hit these milestones, that big, somewhat impossible objective becomes more tangible.
4. Attach incentives and celebrate your achievements
To stay motivated, reward yourself when you reach goal milestones. It can be as simple as meeting a friend for coffee, or taking a whole day off to regenerate and recharge; whatever YOU want.
After all, Xero’s research shows that 63% of sole traders went solo because they wanted to be in control of their own timetable.
Make sure you celebrate the wins but remember, even if you’re not winning, you’re learning. Simpson says staying motivated and sticking to your plan will bring rewards.
“Be patient, build your reputation and give amazing client experiences so that people tell their friends,” she says.
So, heading into FY22, there’s no need to feel daunted or overwhelmed, even if you’re going it alone. With a little planning and goal setting, you can put your business on the path to success in the new financial year.
