Financial Business Goals for Small Businesses
New Zealand is a nation of small businesses, so it’s important to acknowledge their importance. They are arguably the backbone of New Zealand’s economy, so we would love to dedicate this blog to giving tips for small businesses to set financial goals for themselves. Small businesses are those with less than 20 employees, and there are approximately 530,000 small businesses in New Zealand, which represents 97% of all firms. On top of that – they account for 28% of the country’s economy.
Financial goals for a small business may involve achieving a profit margin or reaching a specific goal such as saving enough money to buy particular equipment the business needs. Here are some more examples of goals that small businesses can consider setting for themselves.
Profit and Revenue
Profitability is the most basic financial goal of every small business. Profitability goals for a small business should be enough to keep stakeholders such as owners or shareholders and to help the business save money for expansion or growth.
A profit margin is the percentage of total revenue that exceeds operating expenses. These numbers vary depending on the industry your small business is under. Comparing your profit margin to your industry’s average is a great starting point for setting a goal.
Specific Financial Goals
Each small business is unique in the way they work, so it is common to have specific tangible objectives that can improve operations for that business. To help create a specific financial goal, think of your businesses operations and the current costs it is to run, and consider how to improve.