Build Your 2026 Business Plan Based on Your 2025 Results

December 31st 2025

With only a couple of days left in 2025, if you’re like many business owners, you’ve probably started setting goals for 2026. Creating an annual plan in December for the coming year is a ritual many entrepreneurs participate in. However, if you typically start by looking ahead, without reflecting on how the previous year went, your plan won’t be as effective as it could be.

Looking back at your historical data to see what worked and what didn’t in 2025 will be key to being even more successful in 2026. Better yet, look back at how you did in 2024 and 2023, too. The more data you can analyze, the easier it will be to spot trends and patterns that are impacting your business.

Start with Your Sales Success

To plan for a better 2026, start by looking back over your sales figures for 2025. Where did your money come from this past year?

Break down your revenue by product or service to start. Which offerings generated the most money? How do those numbers compare to 2024 and 2023? Were there any shifts in what your client base bought?

Then look more closely at those numbers. Which types of clients spent the most money with you? Has your ideal client changed? Which clients are the highest profit? Which clients do you prefer to work with?

Based on these numbers, are there products or services that no longer serve your business? Are there offerings that are lower profit? Which products and services offer the greatest growth potential going forward?

Where Are You Spending Most of Your Time?

For service providers, especially, how you spend your time frequently determines how profitable your business is or can be. Make a list of your top clients, how much they spent with you, and how many hours you invested in their tasks. If you can calculate the hourly rate you earned from each, so much the better.

Now rank them by hourly rate or profit margin. You may be surprised by what you find.

In many cases, those anchor clients you thought were critical to your business may turn out to be the biggest time sucks that are getting in the way of your growth. Ideally, you want clients who are high revenue, high profit, and don’t demand a lot of your time. The more of these you can cultivate, the easier your business will be to scale.

Clients that are low revenue generators but high profit, and don’t take up much time, can provide a revenue base you can build on. Because they don’t spend much, you don’t want to invest a lot of time trying to do more for them, but the high profit/low effort dynamic is worth keeping.

What you absolutely don’t need are clients that are low revenue and low profit, no matter how much of your time they require. They’re just not worth the effort. The same goes for high revenue but low profit and big time wasters—the low profit margin means they’re taking up too much of your time for too little a pay-off. Refer them elsewhere or boost the price you charge to make it worth your while.

Scope Out Slow Months

Most businesses have an element of seasonality that can be helpful to recognize. By looking back at your monthly revenue for the last couple of years, you may be able to spot natural spikes in demand and drops at other times of the year, so you can begin to expect and plan for them.

Plotting your monthly revenue can help you plan for adding staff or freelancers during anticipated busy months, and for dialing back expenses during slower months when you expect sales to be lower.

One tool you can create to track this is an Excel spreadsheet into which you put your total monthly revenue going back as many years as you can. Then, at the bottom of each monthly column, calculate the average revenue per month. This helps you spot sales patterns more easily and plan for them going forward.

Identify What Didn’t Work

It’s fun to pat yourself on the back for all of your accomplishments in 2025, but it’s probably more useful to reflect on what didn’t go so well. What did you try that flat-out failed? What changes did you make that didn’t have the desired effect on your business? And what can you learn from what flopped?

What’s that saying: “You learn more from failure than success.” But for that to be true, you have to reflect and analyze where things went wrong, rather than just acknowledging that things didn’t go the way you wanted.

For example, did you launch a new product or service that no one wanted? Why didn’t they? Did you lose clients because your service was subpar or because it was too expensive? It’s important to figure that out. Discovering why something didn’t go as planned will help you spot whether you just need to tweak your offering or give up Altogether.

Turn those Insights into the Basis of Your 2026 Plan

After you’ve looked back on all you achieved in 2025, as well as where things didn’t go according to plan, you’re now ready to outline your strategy for 2026. You know how quickly your business has been growing and whether you can maintain that pace or not; do you need to invest to boost sales or dial back your resource allocation so that you’re not so overwhelmed? What’s your big-picture goal for the year?

Then break your revenue down by quarter, based on historical numbers, and then assign initiatives and resources to back those efforts up. For example, if you know that Q2 is always busy, you may want to allocate more advertising dollars to later in the year, when things quiet down, rather than during your busiest season when you’re already struggling to keep up with demand. Or if one of your services is responsible for 50 percent of your revenue and growing, evaluate setting aside more funds to promote it, rather than investing in something new that may only detract from the growth of your primary offering. Invest more in what’s working and less in what’s not.

Break down each quarter into monthly activities and projected revenue, along with major expense categories. Once you have your upcoming year planned out by month, make a list of activities you won’t participate in next year. This is your “to-don’t” list, which might include trade show participation, customer discounts above X percent, or geographic expansion, for example. Put some boundaries around growth to increase your odds of staying focused on your big goals.

Then, next year, consider journaling regularly about what went well, what didn’t, and what new ideas you may want to explore for 2027. That way, in December 2026, you’ll have even more data to draw on when you prepare your plan for the next 12 months.