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Developing a Simple Plan
Start your 2011 business strategy |
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Written by Michelle Brisebois
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If you have a dream for your business, then planning for that outcome makes sense. According to author John Argenti, “A plan is a list of actions arranged in whatever sequence is thought likely to achieve an objective.” At its core, business planning is about priorities, which are even more critical to small businesses that lack the large human and financial capital of bigger firms. A detailed strategy helps you plan for the future and monitor your progress along the way.
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Planning ahead for 2011 helps you pinpoint your goals and ensures you stick to them throughout the year.
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Break down the numbers
Your business starts and ends with your financials – before you plan anything, you have to consider the bottom line. If you track your sales history, then you already have a solid handle on the ups and downs of your monthly sales. When you look at the numbers, you’ll want to make sure that abnormal events don’t skew your plan for the coming year. If there was a big corporate order in March that was a one-time event, you’ll want to back that out of this year’s projections unless you’re confident you’ll get that order again. Jim Turley of Turley’s Florist in Nanaimo, B.C., is an advocate of documenting the ebbs and flows of the sales trends to help inform next year’s planning. “I keep notes of trends, deliveries, and anything that results in significant peaks or valleys,” he says. “I keep a special folder for Christmas sales tracking. It is really helpful when it comes to forecasting next year’s sales.” In terms of timing, most companies draft a yearly plan that’s ready to go several months prior to the start of their next fiscal year, but the seasonal nature of the floral shop doesn’t always allow for such advanced planning. For Joanne Plummer of Mill St. Florist in Ottawa, Ont., tackling the planning phase in January is a matter of logistics, even though her fiscal year begins in January. “I find that things are quieter in January so I can focus on the planning more easily than trying to deal with it during the busier rush,” she points out.
Consider the market
The market you operate in refers to those macro factors that will have a major impact on your operation. It’s often an issue or set of issues impacting all businesses nationally – or even just those in your immediate area – and these factors can be out of your control. In this section, you’ll address how the economy is doing internationally, nationally and locally. Are there new regulatory issues you’ll need to deal with (hello, HST)? Is your municipality planning major construction around your operation that will impact footfall into your shop? “I had to deal with work on the sewer and water system close to my store at the same time the recession hit,” shares Plummer. “The streets were dug up and my walk-ins were very limited. Coming into 2010, I had to be very clear about what key goals I wanted to address,” she says.
Know your product
Product features and benefits don’t often seem very exciting but they’re a key part of knowing who to target. What does your product look like and why should a customer buy it? Are you truly selling your flowers to your customer? For example, a description of spring wreaths made of native plants, and reclaimed and recycled accents, tells the shopper that this product will likely target an environmentally conscious consumer. The benefit of the product is that the consumer gets to reuse materials they’re looking to repurpose and the plants may not need as much watering because they’re hardier.
You’ll also want to think about which new products you want to introduce in the coming year to address trends. “I often look to northern Europe as a trend indicator for what’s to come here in a few years,” says Plummer. Turley recommends canvassing sales reps, trade shows and magazines for emerging trends to incorporate into next year’s plan.
Scope out the competition
It’s often sobering to discover how few retailers ever visit their competitors. In today’s digital world, monitoring the competitive set is easier than ever. Keep an eye on which shops are opening and closing in your market. Are there non-traditional venues that are starting to sell flowers such as a new grocery store or boutique? Follow competitors on Facebook or Twitter, if they use these tools, and subscribe to their newsletters. Competitive surveillance doesn’t have to be adversarial; it’s a great way to ensure that your businesses complement each other so you both thrive.
Position your brand
Once you’ve analyzed your financial situation, market, products and competitive set, think about how all of these aspects make you unique. “Positioning” is a marketing term employed to speak to where your brand is “positioned” in a consumer’s mind. In other words – how do they perceive your value versus other options available to them? What’s your point of difference? If the shop across the street specializes in traditional designs, then perhaps your position is more modern and contemporary. Knowing what makes you unique allows you to target your marketing efforts more effectively.
Spread the message
Your brand position is now established so you’ll have an easier time targeting your message. If you offer trendy arrangements for the home, local style and home décor magazines will likely prove to be solid places for you to advertise. If you offer more traditional arrangements, then perhaps small ads in church programs or local newspapers will effectively capture your most responsive audience. Funky and more vibrant products and services will likely skew younger, so it would be wise to employ a solid digital strategy involving a website and social media such as Facebook and Twitter.
Account for routine maintenance
Are there big repairs to your facility that can’t be put off any longer? If so, you’ll need to plan for that expense. “Property upkeep can’t wait. Roof repairs will be more expensive down the road if they’re not addressed in time, and by putting on a new roof in 2010 I was able to take advantage of government programs,” says Plummer. As she goes on to point out – it’s a balance of wants and needs when it comes to repairs. You may want the new windows but need the new roof. Would a new POS system improve efficiency? Delivery vehicle upkeep will be factored in here too.
Plan for your staff
What will your headcount be for the year? Do you need to hire or scale back? Take a look at training requirements. You may wish to have staff attend seminars to stimulate creativity or you may need to train them on health and safety issues to meet regulations. Factor in benefits, bonuses (if you offer them), travel expenses and even the staff Christmas party. The cost of an employee is greater than just his or her salary, and it can add up, so make sure that it’s planned for and that your seasonal hiring begins in plenty of time to get the best candidates. When you take into account each of these categories, it can make you wonder how anybody gets any work done with all of this planning going on! Your business plan doesn’t have to be the length of a novel and you don’t need intricate formulas and calculations – develop a system that works for you and come up with a document that you can rely on throughout the year. Four or five pages of handwritten point-form notes may be all that’s needed to give you a framework for future success. What is important is that you give the future some thought. Remember, it wasn’t raining when Noah built the ark.
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