Business planning is critical to the success of any business venture. But it’s also one of those tasks that many entrepreneurs procrastinate over or sweep under the carpet, often until it’s too late.
Business planning doesn’t have to be a burden. Likewise, it doesn’t have to be an encyclopedic effort achieved through hours of market research, number crunching, and mapping out your financials. The reality is that in business as in life, planning should be part of everything you do and it never stops. It not only ensures you succeed, it helps you get there. Here’s an analogy:
Say you have to head out of state on a business trip. You decide to drive. Before you even hit the road, you start planning your trip. In fact, you started planning for trips like this a long time ago. Yes, you may program your GPS or plot your journey online, fill up on gas and perhaps check the weather forecast. But some time ago you also purchased an insurance policy for your vehicle and perhaps you invested in roadside support. So, over time, you undertook a series of planning steps and adopted precautionary measures to make this and every journey safe and successful.
In the world of business, the process of planning isn’t a whole lot different. It isn’t about the document itself, it’s about what goes into that document or PowerPoint, or whatever format works for you.
Here are a few tips to help you keep it simple.
You don’t always need a 100-page business planning document to steer you on your course, but there are some fundamentals that all business owners should think about mapping out. This includes understanding your market, having a clear view of your capital needs, your budget and cash flow and, just as you would when you get behind the wheel, listing some basic assumptions about where your business is now and where you want it to go, and of course, what is it going to take to get you there.
For a freelancer or home-based business owner, this might be as simple as having a goal to expand your client base over the next year from five to ten customers. What strategy or plan of action will help you get there? Some tactics include upping your networking efforts, upgrading your website, seeking out referrals, and so on.
Keeping it simple isn’t an excuse to skim over the business planning process, but it does make it more manageable and gives you a clear course on which to steer your business.
Begin by defining what success is. This will help you set your goals. Then you need focus – start by thinking about what you don’t want to do and work back from there. Who is your target market and what can you offer them that is different? How can you carve a niche for yourself there?
Then set yourself some tangible steps for getting there – dates, deadlines, who does what, and how you are going to measure success (projected sales, cost of sales, etc.), without forgetting expense costs.
Then be sure to keep your plan fresh, revisit it and measure progress against it. As your business grows, your benchmarks for success and the plans that will help you get there will grow as well.
While an overarching business plan for your entire business is important, it’s equally helpful to break up the planning process across the different functions of your business.
For example, a marketing plan is critical for helping you achieve your overarching business goals. But some businesses might also need a staffing plan, a technology plan or an exporting plan. Other plans to consider include partnership dissolution plans, succession planning, and disaster plans. For example, how is your data backed up? How will you communicate with employees and customers if your business is forced to close for a few days – that kind of thing.
There are many online tools and resources that can help you create and document a basic business plan as well as a more comprehensive plan (often needed when applying for a business loan or securing funding from private sources):
Don’t forget that there are many resources in your community that can help with the business planning process through seminars, training and mentoring. Check out your local SCORE office, Small Business Development Center, Women’s Business Center and others to get help with your business plan and find out about other services for your small business.