In sports, getting off to a fast start is often the difference between a winning and losing season. According to Joe Gibbs, “A winning effort begins with preparation.” The same is true in business. It begins with an action plan.
Creating a winning plan is not difficult. Sure it will take some time now, but saves a lot of time later. Most important, it delivers big dividends – more sales, profit, and control. So what are you waiting for?
6 Steps to a Winning Plan
Research.
It helps to know where you are today before you map out where you want to go next year. Research is simply gathering information about your business, competition, industry, and customers. So here are a few ways you can get up to speed:
- Financial Trends. Review your current financial statements – and the previous two years. Look at trends in revenue, margins, profit, and expenses. How about the number of customers, retention rates, debt, and receivables. It can help you uncover the improvement opportunities – so you can focus your efforts in the right areas.
- Competitive Analysis. How do you compare with your major competition? Look beyond price and consider some of these competitive factors.
- SWOT. An honest assessment of strengths, weaknesses, opportunities and threats goes a long way. When doing your analysis, don’t be afraid to ask others – customers, vendors, employees – for feedback.
- Industry Trends. Is your industry growing or declining – and why? What changes are you seeing? Are you capitalizing on the changes?
- Customer Feedback. They can tell you what you do well and what you can do better – all you need to do is ask and listen.
Mission Statement.
It may feel like fluff, but a clear purpose-driven mission statement for your business helps you keep your goals, objectives and values in mind – as you build your plan. A mission statement summarizes the purpose of your business, what steps you are taking to achieve it and the motivation (values) behind it. It should inspire you and keep you committed.
Goals and Objectives.
Start with the big picture in mind and look at all areas of your business – not just sales. Goals are simply your destination on a map and objectives are your route you take to get there. Here are two examples to demonstrate this point:
Goal: Increase revenue by 25%
Objectives (to support this goal) might include some or all of the following: Grow customer base by 10%, Increase average transaction from $203 to $225, Launch new product by March 31st, Hire one additional salesperson by April 1st.
Goal: Improve profit by 18%
Objectives (to support this goal) might include some or all of the following: Reduce delivery errors and re-work by 10%, Invest in [technology] to improve scheduling, Eliminate products with margins under 15%, Revise and implement new credit policy by May 31st, Reduce outstanding receivables by 10%
As you can see, there are a variety of ways to get you to your destination. Choose the ones that work best for YOUR business. Your research can help along with my 155+ Profit Building Ideas.
Promotional Tactics.
Using the information above, now it is time to identify the marketing and sales tactics (or tasks) you need to do to accomplish your goals. This should include methods to generate new leads, retain and grow existing customers and improve sales conversion rates. You have a lot of options here, but it’s a quality versus quantity game. Decide what you want and then execute with consistency. Remember to include timelines for completion and responsibility if the task is delegated or outsourced.
Operational Tactics.
Your business is a combination of people and systems that evolve together – and are the key to sustainable growth and profit. So as you build your action plan, you need to look beyond the marketing and sales elements. How can you improve your daily operations and increase efficiency and profit? What actions can you take to build a stronger team — employees, subcontractors, vendors and suppliers? My business success checklist may provide some additional ideas. Remember to incorporate timelines and responsibilities here also to ensure the work gets done.
Budget.
While it’s never on the “can’t wait to do list”, preparing a budget to support your plan is important. It shows you how the growth and investments you plan to make will impact your profitability. Simple works best so many owners use their current profit and loss format to complete their budget.
If you are serious about your business and committed to its success, an action plan is the best tool out there. Make creating an action plan a priority and invest the time to do it!
Additional Resource
For help with setting goals and creating your action plan, check out my Ultimate Goals & Action Planning Guide, a step-by-step approach to planning. This guide provides everything you need, including tools and samples, to get it done!