Being self-employed or having an SME requires an excellent effort on a day-to-day basis, and it’s tremendously easy to get lost on the road putting out fires or solving crises, which leads to putting aside the main thing in your business, which is sales and getting results. The best recommendation is to understand practical business planning and to have a solid business plan.
Since sales are what sustains your entire business, and the key point to the success of any business is planning and being strategic.
Thus, in making a business plan, it is important to know how far – and when – if you intend to go with your business, this is very important in practical business planning. After all, not making a business plan is among the causes of business failure for 80% of companies.
Still, if it is the first time that you are going to develop a business project, it may seem complicated. But the truth is that some tips are easier to do.
And that’s why Utopsolutions brings you this article, to teach you how to make a business plan for your company, in addition to providing you with practical tips on the main points that you should pay attention to in your project.
So, keep reading!
What is a Business Plan?
In practical business planning, a business plan is a very important project for a company, especially when you are just starting with the activities. We are talking about a powerful tool that allows you to plan the entire path you intend to take to achieve previously defined objectives.
The Business plan of a company is a document in which the actions that the company will take to attract and retain customers, what products or services will be sold, what its financial projections are, and everything that involves the commercial strategy of a company is captured.
It is a set of planned actions that are destined to achieve or execute certain objectives. We could even define it as a guide to the actions to be carried out to achieve sales; results and benefits.
The plan must be written after a thoughtful process and agreed upon with the sales team so that everyone is aligned on the steps that must be taken to achieve the objectives that have been set at the beginning of the year.
With the plan ready you can analyze the general idea of your business. That is, it is possible to conclude whether it is worth it or not, in addition to helping to identify problems that may occur in the future.
How to Make a Business Plan?
To develop an efficient business project you can follow these tips:
This is usually the first part that appears on a business plan document, but it is usually the last part to be written, it captures major components of the business plan, such that the whole business plan is summarized and captured at a glance.
Description of the company
Here, you must state what your company is about. That is, what is the nature of your business, what are the competitive advantages that will add value to your consumption, who is your buyer persona, etc?
Situation analysis (SWOT analysis). Analyze the environment, that is, of the market in which your company will be situated.
Internal analysis: Try to answer questions such as: what is the current situation of the company, what are the weaknesses and strengths, what the company offers, what are the products or services, what needs of consumers your company satisfies, who are the customers – current and potential? In addition to seeking to answer the 4P’s: product, place, price, promotion.
External analysis: At this stage, you must make an external analysis, that is, from outside, such as what are the threats, what are the market scenarios, who are the competitors, and what their positioning is – make a comparative table between the concurrent and your company.
Define strategies: With all the important analytics ready, it’s time to define your actions. Here, you consider, what will be the characteristics of your product, what price it will have, and how you will promote and distribute it.
Define resources: Here, define what will be necessary to carry out the strategies you defined. For example: Will it be necessary to hire more people for the team? What equipment should you consider? Don’t forget the CRM (customer relationship management) and Sales software that help you achieve your goals more efficiently.
Action plan: The action plan can be a timeline with the actions to implement your strategies, for example. It is important to define deadlines and priorities. However, do not forget to plan with deadlines that are reasonable and realistic to be reached.
Results: You can only tell if the business designed in the business plan of a company is on the way it should be if you measure the results. Therefore, try to define indicators that will serve as a guide when measuring. For a more streamlined process, record everything in a CRM if necessary.
Business Plan Mistakes
The points presented in this article are points that are normally important when writing a business plan. However, it is necessary to pay attention in order not to make mistakes, which are also very common at this time, such as:
Make a plan too big: In today’s world, plans are no longer as long as they used to be. Your plan should be concise and should only include the fundamental points.
Value more aesthetics: Yes, your plan must have a good aesthetic presentation. However, the most important thing is the content you present in the project. Therefore, pay the really necessary attention to each of the elements.
Not having a plan B: When developing a business project you must imagine all the possible scenarios for your company. Therefore, you must anticipate all the problems that can happen and have a plan B for that.
Not making a realistic plan: When preparing the project, be as realistic as possible. That is, both for the problems and solutions, Imagine having the possibility to not grow due to not having enough funding.
Business planning is the roadmap to the future of the business written. As with projects, this preparation before execution, analysis, and structuring that precedes taking action is vital to minimize risk and aim for success.
Keys to Practical Business Planning
Whoever is in charge of carrying out business planning must know that, from their effort, documented knowledge must be obtained about:
- Where you are going to advance.
- What actions will be taken to achieve it?
- What means are available to guarantee the viability of the plan?
This business planning, in addition to relying on quality, updated data and being the result of consensus, is never a unilateral decision; it must be supported by a well-defined strategy.
The design of the tactic to follow is the result of a process of abstraction that begins with the posing of questions such as the following:
- What time frame is available to implement the plan and how long should the first results begin to be seen?
- Who should you answer with this business planning?
- What is the main objective behind the business plan?
The answer to these questions will improve the ability to specify business planning, by allowing clear aspects as relevant for the definition of a plan and its subsequent implementation as the following:
- Goals and objectives: translating the vision into words, making a list of priorities, and even creating a checklist that helps not to forget any important points are ways to improve this important aspect of business planning.
- Financial needs: these will depend on whether the plan has been prepared with a view to the short or long term and, of course, the resources, means, and tools that are necessary to carry it out.
- Marketing: you have to look for sponsors and get the support of Senior Management.
Updating Business Planning
Updating your business planning shouldn’t wait. In practical business planning, it can always be a good time to review the plan and check its fit, although this task should at least be carried out on the following occasions:
- On an annual basis: review the value proposition made to customers and potential customers, try to open up to new market segments, or diversify.
- At the end of each month: In this updated review, it can be used to adjust deadlines, tasks, or activities, better adapting them to reality. At least to check that there are no major differences between the results achieved and those planned, especially in the area of finance.
- Every time a significant change is introduced: Either within the organization or in the market, it will also be necessary to update business planning, gain alignment with the situation and its circumstances, and improve the approach to decision-making and actions to be taken.
Stages of Business Planning Process
Every planning process determines eight stages
- Diagnose the situation: you must carry out an exhaustive internal analysis of the company and external of its environment to diagnose the current situation in which it is.
- Set objectives: you must determine both the main and secondary objectives and quantify them. The objectives must be coherent, measurable over time, achievable, accepted by all those involved, flexible to changes in the environment, hierarchical, and easy to understand.
- Establish premises: establish a series of logical assumptions about the situation of the company, both internally and externally.
It is about making a forecast about what will happen with those variables that are not controllable by the company and, in some way, may affect the achievement of the objectives. The aim is to have all possible alternatives prepared.
- Determine lines of action: also think about strategies. Determine the main and alternative courses of action that you consider optimal to achieve the set objectives.
- Evaluate the lines of action: analyze the strengths and weaknesses of each of the strategies identified to know what you have and what you must take into account.
- Choose a line of action: choose the set of strategies and alternatives that provides you with the best guarantees of success.
- Elaborate-derived plans: develop a series of annexed plans that support the general plan and that regulate the different actions of activist groups.
- Budget: Finally, quantify the plan in monetary units.
Basic Steps in the Planning Process
Planning is the process of evaluating your business objectives and creating a realistic business plan; where you must write your action plans according to your strategies to achieve the objectives set.
As in a business plan, in a planning process, you must take into account the short, medium, and long-term periods within your strategies.
Let’s look at the seven basic steps to carry out a planning process that involves the creation of a roadmap that must describe each task that must be carried out to achieve your general objectives.
The first step in getting off to a good start with the development of a planning process is to identify the specific objectives of your business. In this part, you must include a detailed description of each goal; detail the various reasons or analogies for your selection, and what the expected results are for each of these goals.
The objectives must be described in quantitative, not qualitative terms.
Example of an objective: Increase the company’s profits by 25% during 12 months at the financial close of the previous year.
Identification of Resources
Each of the goals identified in the previous step must have associated financial and human resource projections to achieve compliance.
For example,(based on the objective of step 1): Identify and quantify both in people and in costs of how many people from the sales team will be required to meet this objective of increasing sales by 25%.
Set Related Goal Tasks
If you do not want to collapse your team and you want everyone’s efforts to be efficient, each goal must have its tasks, projects, and well-detailed achievement associated with it.
With this step, you will not only ensure that each member of your team is focused and oriented on what to do, but you will be able to maintain motivation within your staff by meeting objectives, to the point that you can carry out an incentive plan.
For example, if your objective is to increase profits by 25%; a manager will have to outline the tasks necessary to meet that objective, and this is based on the previous step where he previously analyzed the number of commercial personnel that he must have to comply with the goals set.
A perfect task can be; Increase sales staff by 3% per set goal. And to achieve an effective result and with the motivation of your staff, it can be complemented with; developing a training plan on advanced sales training techniques.
Prioritize goals and tasks
If you have already established the goals, and the resources that you will need to achieve these objectives, and identified the tasks to be executed by objective, now the next step is to prioritize each goal and task for each objective according to their importance.
Tasks that are considered most important should be tackled and completed first. In this prioritization process, you must also reflect on the steps necessary to complete each of the tasks to achieve them.
For example, if your goal is to increase sales by 25% and an associated task is to increase sales staff, your company will need the steps in chronological order to complete the steps to achieve that overall goal.
Create activities and a calendar
As your managers identify and assign priority to each of the projects, it is imperative to create a calendar where not only each activity is described, but you must also establish who or who will be responsible for its execution and what is the completion deadline; this to comply with the general terms of the company.
Each superior must know and has identified the skills of each of the members of his sales team so that when assigning a task to an individual in the team you make sure that he/she will be able to achieve it efficiently and promptly, and in the expected time without achieving discontent within the team.
For example, the sales manager can assign additional monthly revenue installments as an incentive to stay on track for the goal of increasing sales by 25%.
Now, many managers are against incentive plans claiming that they must not reward staff for the functions and responsibilities for which they have been hired. To clarify this, developing an incentive plan must not be continuous. This implies that you are not going to reward them for each of the functions as your sales team but rather, will apply in certain periods and goals to be achieved.
If you are one of these managers who do not agree to give incentives with additional income to their salaries, they can run contests with prizes such as trips for two or with technological products that are so necessary for sales personnel such as good quality smartphones or tablets. This has worked very well, and not only will you achieve the objectives, and keep your staff motivated, but you will create a healthy environment of competition with clear rules for the contest.
Establish evaluation methods
Every planning process must include a strategy of how the evaluation and follow-up methodology will be to keep track of the progress of each of the goals throughout the established period.
One of the main reasons for the importance of this step is that with the continuous measurement and supervision of the results executed if there is any result that is not desired for the benefit of meeting the general objective, you will be able to identify it in time and react with the indicated corrective actions.
For example: Request a monthly report of the progress status of each goal to the department heads per established team.
Identify alternatives for action
This is not to be pessimistic, on the contrary with this last step, the message conveyed to you is prevention. Even the best plans can often change course and lead to unforeseen events. Why? Because the market is dynamic, changing and they are always influenced by situations that may be out of your control.
A management plan must include a contingency plan in case some of the aspects of the master plan cannot be achieved.
For example: Define alternative courses of action that can be incorporated into each segment of the planning process, or for the plan as a whole. Just to be clear, to achieve these 7 basic steps of any planning process, the key ingredient for achieving objectives is your team of employees who are under your management. And, the best thing is to build a strong work team.
In conclusion, the purpose of this article is that your projects within your company will achieve a successful end. And with due planning process with these simple basic steps and a wonderful team, you can be assured that you will achieve it.”