Business Planning
How many people truly realize the importance of business planning? It is scary to see how many so called business entrepreneurs are running their own business on a day to day business without any kind of planning whatsoever. Is it any surprise then that so many new businesses don’t succeed?
To ensure business success, your planning is the most important factor in your whole strategy. Without proper planning, no one (including yourself) will know where to head to. Amazing the going on a safari – example.
Let’s assume we are 5 people planning a trip from Cape Town to Cairo. Where do we start? I have never seen anyone going on any trip, just wake up one morning, put on some clothes, getting into a car and the just start driving. No, a couple of months before the trip we plan the broad outlines - when do we leave, where do we go, how long do we stay. Then we start filling in the blanks – what time will we leave on that day, how long will the trip be, where will we stop on the way, where will we stay. After this phase we go into even more detail – budgets, what to eat, where to eat, sightseeing and more. You get the drift.
Imagine not doing this – chaos. Why then would people think running a business would be different? It is exactly the same thing. You need to know where you want to go to, when you want to get there, where you will be starting from, what you will need to get to your destination, budget and this list goes on and on.
Business Planning In Detail
Having looked at the above, it is then rather logical that you need to break your business planning up into different phases. Let’s have a look in a bit more detail by using ABC Store as an example. This is a new business planning to open in two month’s time.
Startup Planning
This is where you draw up your first business plan. You need to look at what you will be selling, define your target market, get a marketing strategy going, draw up a budget with expected income and expenses, out of this you need to work out your breakeven percentages, selling prices, mark-ups and more. You also need to look at staff resources, how many you’ll need, job profiles, job descriptions, legal aspects. As well as where your shop will be, why and more. To help you focus on covering all bases we suggest you use a sample business plan.
Short term planning
This is the targets for the first 6 months – what do we want to achieve from startup to month 6 and the how to achieve it part. If all the above was covered in your business plan, you simply use the business plan as your roadmap to your goals.
Medium term planning
Targets for the first 18 months – 2 years. Once again by using the business plan as roadmap or guideline, you set achievable realistic targets.
Long term planning
Very important – as most people neglect this part completely – they start off and then go wherever the business takes them. Do this when you start. Plan for the 2-5 year period.
Isn’t it time you started planning for your business?
