With 2017 drawing to a close, many of us are already looking ahead to next year; making plans, setting goals, lining up opportunities. But surprisingly, less than HALF – just 47% – of small businesses have a formal, written or recorded business plan.
If you’re looking to maximise your business success, you need something concrete to work from. Let me help you create your own business plan in a day.
Why do I need a plan?
Even if your business is up and running happily, you have all the investment you need and things are going well – you need a plan. Trust me.
A business plan isn’t just a fund-raising tool (but if you are looking, it’s a must). The trouble is, if you don’t know where you’re headed? Any old path will do. And without that sense of direction, you risk derailing your business altogether.
A plan forces you to define what success looks like. It’s a chance to take stock of where you are now, and set out clearly where you want to go. It’s not just about what you want to achieve, but how you plan to achieve it within a set time period. It’s a benchmark and a vision that holds you, and your business, accountable.
A plan, simply, helps ensure your growth targets and objectives are being met. Looking to grow in 2018? You need a plan.
How do I start?
My first bit of advice is – don’t be daunted or put off by the idea.
The majority of business leaders drawing up plans aren’t experts. They’re just like you and me: learning as they go, passionate about what they do, but probably not connoisseurs when it comes to the paperwork.
Forget what you think you know about business plans. A business plan doesn’t have to be a 50-page essay. In fact, the best plans are short and simple – it should be a dynamic document, and grow and adjust with your business.
So, where do you start? Well… by starting.
A business plan is, in reality, the answers to a series of questions. Begin by simply bullet-pointing the answers to the following 6 key, foundational elements of your business. Your plan will grow from there.
1. Company & Product
Quite simply, who are you? What do you do? What is your product or service?
Define clearly what your offering is – and what you have on your product roadmap. If there’s anything in the pipeline that you are looking to develop and offer, note it down.
2. Industry & Competition
Who are your major competitors, their strengths or vulnerabilities? How are you differentiating yourself? What’s happening in your industry? Any trends, threats, opportunities?
With Brexit looming, this is a key question for many of us to factor in. We’re in a state of flux and the uncertainty can seem like a threat – but it doesn’t need to be. Consider the possibilities and where you can gain competitive advantage – or where you might need to give yourself a safety net.
Who is your target market? What are their needs, challenges? Has your customer base shifted, or do you need it to?
Don’t assume that because your customer base has always looked a certain way, that it will stay that way. Markets are shifting and changing all the time. And if you’re looking to grow your business, you may need to tap into fresh markets or expand your offering to new customers. To get inside their heads and answer these questions, it may help to create a persona for your target demographic.
4. Marketing and Sales
How are you reaching your target market segments? Is it effective, or are there new routes to market you should consider? What about your brand, and how you promote yourself as a business? What is your pricing plan?
With a clear definition of who you’re marketing to, you can fine-tune the how. This is one of the fastest-innovating areas of business, thanks to the power of technology and social media: don’t let your business become static. Consider what partnerships or activities you need to include to reach your customers.
5. Team and Resources
Who do you currently have on your payroll, and are there any skills or resource gaps to fill in the coming 12 months? Do you need to hire internally, or get freelance or external support? What about material resources – technology and software, or operational resources?
In a world of constant technological innovation, things date quickly. Consider not just what you need now, but how futureproof your chosen solutions are. Cloud-based technologies that automatically update are lower risk. Similarly, your personnel plan needs to consider not just your immediate needs, but your future plans – and you need to allow time to get staff on-boarded, trained, and up to productivity before you’ll see returns.
Ah. The big one. The scary one.
What’s the current state of your cash flow and what capital does your business hold? What’s your company turnover and profit – now, and your projections? For 2018, 5 years, 10 years? Do you need external funding to achieve your objectives? Where will those funds be invested? What about employee and operational costs?
Planning out your finances can seem daunting, but you don’t need a PhD to get what you need. Set out your monthly projections for the next 12 months, and annual projections for 3-5 years after that. Include your sales forecast and P&L – but you don’t necessarily need to go into granular detail. Remember to include your cash flow statement and a balance sheet that gives that top-level overview of the financial health of your business. If you’re investing in your business, map out where those funds will go.
End at the beginning
Once you’ve gone through the key questions about different areas of your business, you begin connecting dots you may not have seen otherwise. For example, if your objective is to increase sales revenue by 25%, but you’ve only planned for 1 additional sales resource, how are you going to achieve this?
Make those links and fine-tune your plan. Then, you can write your Executive Summary. This is the opening of your business case – but it’s always best to write this last. It provides that top-level overview of what you’re setting out to achieve, and how.
Remember: the worst business plan is one that is never written at all. Even if you just have a one-pager of bulletpoints that no-one but you ever will ever see, you’re still steps ahead of those competitors that didn’t take the time to evaluate where they are, and where they want to go.
Still not sure where to start? Join us for a 1 day workshop and create your 2018 Business Plan in a day on 30th of January.