How to do an end-of-year review for your startup or small business

This blog stems from one of the questions asked at our Lean Coffee event. The problem was, how do you review your business at the end of each year?

How to do an end-of-year review for your startup or small business
Most people take time out over Christmas and New Year and spend some time reflecting on the year that's been and the year that's about to come. It's one of the few times in the year when everyone else has stopped working. So you too can stop working on the doing and have a chance to work on the strategy.
This article sets out some tools and strategies that you can use to do a useful end-of-year review that will help to guide your plan for the coming year.

What do you mean by an end-of-year review?

An end-of-year review involves taking time collecting and assessing relevant information to develop a clear view of your performance, and the performance of your business, over the past year. This information helps to make decisions and guide the strategy for the year to come.

What's the point of an end-of-year review?

If there's not a valuable outcome from the process, there's no point doing it. Here are three reasons why I believe an end-of-year review is a good use of time:

It's An Opportunity To Re-Focus

Any opportunity to reconnect with the overall purpose and mission behind what you are working on is valuable. It's easy to get caught up in the day-to-day grind and forget what the point of it is. Putting the end goal front of mind will help to prioritise what is most important.

The Best Way To Predict Your Future Performance Is By Looking At Your Past Performance

Optimism is a useful mindset when starting a business, but it can lead to unrealistic goals and expectations. Reviewing the year that has just been will help to ground your plans for the coming year in reality.

Data Is More Reliable And Less Dramatic Than Your Memory

There is likely an abundant amount of data that collected over the last year to use to assess your performance - your bank transactions or financial reports, your website analytics, your calendar entries etc. The specific information that is shown by this data is beneficial for making decisions about how to improve your performance next year. Often it's the small changes that make the difference, rather than big dramatic ones.

How to do an end-of-year review for your business:

There is no one right way to do an end-of-year analysis. However, I think it's essential to use the information you have wisely and to take the time you need to do a good job, so the outputs are useful for driving next years strategy. Below is a framework that you can use as a starting point to guide an end-of-year review for your business. This process may take you a day, or it may take you a week, it depends on how much time you want to give yourself and how much work you need to do to get the information you need. 
I note that this has been prepared for an individual business owner. You can iterate on what's set out below to do it with your team.
Step 1: Assess Your Progress Towards The Overall Goal And Any KPI's You've Set
Reflect on your performance over the last year relative to what you set out to achieve at the beginning of the year (or whichever period you are working with). Here are a series of questions to guide your review process:
1. What is the overall goal? The mission or purpose of your business.
2. How do you measure your overall progress towards this goal? Your #1 key metric. It might be the number of users, number of bookings per month or revenue growth.
How did you track on this metric over the year?
3. What are the biggest drivers of your #1 key metric? These are the activities that have the most significant impact on achieving your overall goal. They might be the key performance indicators (KPI's) you have set. I call them sub-metric. For example, talking to X customers per week, growing website visits by X% per month, having a returning customer rate of XX%.
How did you track on these sub-metrics over the year?
4. What were your assumptions for setting these KPI's or sub-metrics and were your assumptions correct, i.e. are they driving the behaviours you want and producing the outcomes you want?
If you can't answer these questions with certainty, one of your goals for early next year should be to set up systems to start capturing the data you need to be able to accurately asses your performance. It might be as simple as installing google analytics.
Step 2: Financial Analysis
The financials of your business show an accurate picture of its performance. There is no hiding from the numbers. Sit down with a copy of your financials and review the numbers. If you use accounting software like Xero, and you've kept it up to date, you can quite easily extract the profit and loss statement from the reports feature. If you don't have a financial statement, create one from your bank statements. Pay attention to revenue streams, expenses, what's trending upwards and what's trending downwards. If you have not been looking at your financials regularly, you may find some surprising information that can help you to decide how to focus your efforts next year.
If you have an established business model, use your financials from the year just been as the basis for setting financial goals for the year to come. For most early-stage businesses, two vital financial focuses are:
1. Revenue growth - how much your revenue needs to grow each month to meet your goals. What made the biggest difference to revenue during the year?
2. Unit economics - how the variables that affect the amount you make per sale need to track to ensure you hit your financial goals. What made the biggest difference to unit economics during the year?
Step 3: Productivity Analysis
1. What were the activities that you needed to spend most of your time on to meet the objectives set out in part 1?
2. Where did you spend most of your time? You can look at your calendar to get an idea of this.
3. What was the lowest value add tasks that you had to spend time on this year? Can you stop or outsource some of these tasks?
4. What was the highest value add jobs that you spent time on this year? How can you do more of this next year?
5. If you think about periods throughout the year, when were you the most productive and when were you the least productive? How can you build these learnings into your work plans for the coming year?
Step 4: Personal Reflection
1. What activities brought you the most personal satisfaction and growth?
2. Which activities brought you the least personal satisfaction and growth?
3. What new skills did you learn throughout the year, or in which areas did you excel?
4. What skills and behaviours were you not so competent it?
5. What is your personal goal for this business? Were you successful in achieving this over the past year? How do you know?


An end-year-review of your business is an excellent way to bank the learnings from the year and use them to inform the strategy for the coming year. In this article, we've suggested some questions you can find the answers to help with this review process. These questions fall under four broad categories: progress towards the overall mission, financial performance, productivity and personal reflection.

We wish you all the best with this process and for the coming year! May it be wildly successful.

Thanks to James Rowlands for posing this question at Lean Coffee 👍