As a small business owner or entrepreneur, you started your enterprise with an overall goal and a strategic plan to reach that goal. How long is it since you even looked at that plan?
Planning is an essential skill for any small business owner or entrepreneur. Without good planning, your business is likely to fail. You need to review your business plan at least every year and to plan productively for the coming year. Your business plan is a key document for the everyday running of your business and you should not lock it in a filing cabinet and forget about it.
Many small businesses and entrepreneurs fail in the first few years of business for no other reason than a lack of planning. A solid business plan will include contingency plans as well as your goals. It will include information on your planned actions to sustain and, more importantly, grow your business. An annual review of your business plan allows you to reconsider your goals and plan new actions for the coming year.
Without reviewing your business plan regularly, you may find your business suddenly goes downhill and you have no idea why. Maybe your competitors have released a new product or you have focused your energies on achieving your financial goals but have forgotten to work on your goals for maintaining and rewarding your good employees. If a key employee leaves your small business suddenly, you can lose more than just the knowledge and skills of that individual. You could lose customers and your business reputation too.
A good business plan is a working document and you can revise it as often as you need to in reaction to circumstances and changes in your business. Successful entrepreneurs will always tell you that the confidence to take the actions that others assume are risky stems from having a solid business plan that enabled good contingency planning to mitigate the risks.
Here are some of the features of your business plan you should review regularly (at least annually, if not more frequently).
Compatibility with Your Overall Business Strategy
Entrepreneurs who are awake to new opportunities may discover that the new opportunities are leading the business away from core goals or the overall business strategy. You may need to look at the direction your business is taking and revise your plan and your business strategy accordingly.
SWOT
A small business that is two or three years old will have different strengths, weaknesses, opportunities, and threats, than one that is just starting out. An annual review of your SWOT statement will ensure you keep on top of the threats to your business, explore the new opportunities, and continue to grow your strengths column while learning from your weaknesses.
Financial Goals
Review your business financial goals and decide if the goals are in line with the current economic climate and the forecast growth of the business.
Customer Goals
Review your customer goals to ensure that you are looking after the customers you have and to look at new markets or customers you want to have by the end of the year.
Product Goals
You need to take a good look at your products and decide if your current products will continue to meet customer needs in the future. If not, you need to plan to create new products with detailed research and development actions.
Operational Goals
Your business operations need to align with customer expectations, the expected growth in sales, and any new products you wish to launch in the coming year.
People Goals
Employees can be key for running the business successfully. Even if you have no employees, you still need to consider whether your personal skills still align with the needs of the business. Do you need to undertake some additional training to keep up with your business goals?
Environment Goals
Are your business goals and action plans still environmentally friendly? Consider whether you need to revise and change your plans for the good of the environment.
Action Plan
Finally, the last section you should revise in your business plan is your action plan. This should include specific actions, who is to complete the actions, and when. The action plan should be the part of the document you refer to most regularly, as you check off the actions you have completed.
Updating and reviewing your business plan regularly will ensure you keep your business on track to achieving your goals and that you do not have unpleasant surprises in your business.
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