If you’re thinking about starting a side hustle or own a fledgling business, you might be so concerned with the day-to-day that you forget to plan for the future. But if you don’t have a road map in front of you, how will you know where to go? It’s important to set goals for your business to keep yourself on track, especially in regards to income.
Setting income goals for your business will help you achieve sales and find clients beyond what you ever thought possible. However, if you set random goals without strategic planning, you’ll risk throwing off your trajectory.
Here’s what you need to know about setting income goals for your side hustle.
1. Set business goals first.
Before you can set an income goal, you need to know what to expect from the business itself. Where do you see your side hustle a year from now? Five years? Ten years? There’s no shame in keeping a side hustle as just a hobby for a little extra pocket money, but if you want it to become your full-time job, you need to set some business goals as well as income goals.
In order for your business to grow over time, you’ll need ways to “scale.” This is a term that’s thrown around often in the entrepreneurial world and it’s often misunderstood. When we’re talking about “scaling” a business, we’re not talking about starting or even growing a business. “Scaling” means being able to take on more work without sacrificing much in terms of income or in other areas, like time management or working yourself to death.
Brainstorm additional products or services you can offer in the future as your business expands. If you anticipate hiring other team members or contractors, how many, and when? Will you want to offer any special bonuses to your team? All of these will factor into the income goals you will need to set in order to succeed.
2. Check your history.
Next, take a look back at your business’s sales over time, if any. How much money have you been making so far? What seems realistic to expect for next month or next year if things stay the way they are?
If your projected income based on your sales at this point isn’t as high as you hope, don’t worry. This is just an estimate of what you can expect if your business continues at the level it’s currently functioning at. Your goal should be to grow!
3. Factor in expenses.
For this step, we’ll need to look to your past as well as your future. What have your expenses been so far? Don’t leave anything out, no matter how small. Even the tiniest expenses can add up over time, costing you money and throwing off your estimates.
Now think about new expenses that you can anticipate as your business scales. Those new hires we thought about in step 1? This is where you’ll need to think about how to pay them. If you want to rent a spot in a coworking space, how much would that cost in your area? Do some research and pull up realistic figures so you’ll know what to expect.
4. Pick an end goal.
After you take those expenses into account, it’s time to think about the fun part: Profit! How much money do you want to be making from your side hustle per year in an ideal world?
Add your profit to your expenses and factor in some leeway for emergencies. Be sure to take year-end taxes into account, too, based on your country’s taxation laws. You’ll need to pay taxes on your earnings every year.
Add all these things up and the final figure is the amount you’ll need your side hustle to make each year in order to meet your goal.
5. Create milestones.
By this point, you might have an end goal so large that you can’t imagine ever reaching it. That’s okay! Even the biggest goals can be achieved if you just put one foot in front of the other. The key is to divide your end goal into smaller milestones that are easier to achieve.
You can choose quarterly goals, monthly goals, or even weekly goals if that’s feasible for your business. The key is to match up these income goals with your business goals so you’re growing your business over time. What can you do this week, month, or quarter to find more clients and boost your income?
6. Write it down.
It’s no secret that actually recording your goals somewhere makes it more likely that you’ll actually work toward and achieve them. In fact, it’s science.
Once you’ve gotten much of the background information worked out, write down your goals. I would even go as far as encouraging you to literally write them somewhere you can see them. In this day and age, it’s easy to record something digitally on a spreadsheet, in a Google doc, or an iOS note. I’m particularly guilty of this myself.
But physically writing things down helps us to better remember whatever it is we’re trying to remember and give it more power.
Putting these things somewhere you’ll see them often will further reinforce those goals in your mind. You’ll be even more likely to put in the work needed to make things happen. Trust me – it’s made all the difference for me in my business.
While setting income goals for your business can feel overwhelming at first, the key is to do your research and use real numbers in order to project the final figure. No goal is too lofty to aim for.
As the saying goes, shoot for the moon! Even if you don’t hit your goal, striving for greatness will lead to more success than you could otherwise achieve.