Tue 6 Jan 2009
Holiday time is over. Okay, back to work. I mean this in a broader sense. Both 2006 and 2007 were fairly good years economically considering the recession of 2001 and 2002. In 2008, we saw things fall apart and the soothsayers are calling for a dismal 2009. Emarketer reports spending decreases on all but digital media. Even the new president said things will probably get worse before they get better. At a new years party, I asked a friend if they had any resolutions for this year. He said "holding on to my job." What a depressing thought. Yes, the holiday is now over.
The reality is that virtually every organization, non-profits and government agencies included, is cutting back on spending even if they have cash in the bank. With the near-term future being very unpredictable, many feel that it is better to hold on to your money now than to wish you had it later.
The unfortunate side effect is that with spending decreasing, revenues will decrease. So, if your revenues haven't dipped, consider yourself one of the lucky ones. Flat growth is better than no growth any day. Given the jitters of the market, reviewing your forecasts more frequently throughout 2009 will serve you well. Use this timetable as a guideline for the next six months. Post it next to your desk or put it in your calendar so you don't forget.
1. January: Prepare your annual forecast. If your market segment is too unpredictable, forecast through June. Prepare monthly targets that are in line with your forecast.
2. March: Revisit your forecast to see if you are hitting your targets. If not, ask yourself why. What product or service changes can you make to increase sales?
3. April: Q1 is over. Update forecast for remainder of 2009, including tweaks to products or services that you identified in March.
4. May: If summertime is usually slow for your business, what promotions do you have planned to keep pace?
5. June: Q2 almost over. What is selling and what is not? What changes have occurred in the economy that you need to address? What does the rest of the year look like financially? Can you see far enough into 2010 to identify what you need to be doing now to increase revenue?
Stay focused and don't take your eye off of the numbers. I've been through several recessions - even started my current company in the midst of the last one - and each time it has been the companies that manage cash efficiently that come out afloat, even ahead.
All the best for a great 2009!