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Here are some figures that will make your head spin. According to Search Engine Journal, 50% of business owners don’t have a marketing plan in place, and 72% of owners don’t have a succession plan, as per CPA Practice Advisor.
While that’s bad, only 33% of business owners have a formalized plan in place, as per a 2015 Gallup poll.
Though egregious, these numbers seem far too generous. In fact, I believe actual numbers are closer to five percent, two percent, five percent, respectively!
2021 is right around the corner, so you should start crafting next year’s business plan, and the perfect place to start is using last year’s plan.
Stop reading this and go grab it.
Oh, yeah, you’re probably one of the people who doesn’t have a formalized, written plan.
I’m not being harsh for the sake of being harsh. It’s vital that you create a plan for your business each-and-every year.
A lot is happening in 2020, and you need to factor these events into your 2021 plan.
Bring in essential personnel
As you’re developing your plan for 2021, bring your key people into the fold.
If your key people, your managers, your department heads, aid in developing your plan, they’ll be more invested in the plan.
If you are a one-to-two man shop, have a trusted advisor assist you.
Determine What You wish to Accomplish
Think about sales. Think about profit. Think about your geographical footprint.
Are you looking to expand the locations you service, or are you looking to increase your market share in your particular area?
What about expanding the services you provide? Perhaps you want to manufacture new products?
Determine how you might be affected by tariffs, fuel increases, potential wage increases, banking issues, union issues, and more, creating a flexible plan to account for these changes.
Have a plan for the unforeseen
If 2020 has taught us anything, it’s to expect the unexpected.
With COVID-19, a recession, and banks acting screwy, you must plan for disaster. Create a reserve of cash to help stave off problems that may arise throughout the year, whether internal or external.
Start developing a rainy-day fund where you set aside a percentage of every dollar collected. Put away enough money where it has minimal impact on your daily operations.
For example, say you decide to set five-percent aside. If you collect $10,000 one day, you put away $500. If this is a challenge, you most likely have some underlying issues.
Build a rainy day fund because you better not be counting on federal stimulus money in 2021!
Resources and Strategy
After you compile a list of what you want to accomplish, look at developing a plan of action to make it it into a reality. Ensure you have the capital to move forward and a strategy that will hit the ground running on the first of January.
Capital, in my mind, is liquidity, people, equipment, and processes.
For the few that actually have a formal, documented plan, keeping track of your progress throughout the year is a strategy often overlooked by business owners. Break your plan down into goals and milestones to determine where you should be annually, quarterly, monthly, and weekly, and segment that by each department. Track your results accordingly.
Start Right Away
When developing a plan for American Management Services, I like to start the process in October, begin drafting in November, and have it finalized and in our team’s hands by December.
Start ruminating on what you want to accomplish now!
If you need some assistance in developing your formalized plan, don’t hesitate to call me at (800) 743-0410.