7 Tips for an Effective Business Plan

We’ve all had times when the prospect of completing a ‘Business Plan’ fills us with absolute dread and horror. But at Seed Accounting Solutions, we strongly believe that every business, no matter the size or where they are in their business lifecycle, has a Business Plan that provides the foundations to their day-to-day work. You can find out about why you would benefit from a Business Plan here. If you aren’t ready for our Business Planning Services, maybe think about creating your own plan with our 7 handy tips:

1. Keep it Short – gone are the days when a 32-page document is required. The shorter ad more concise it is, the more likely you are to use it. We recommend keeping it to one page (although you may, like us, actually spread it out to look a bit nicer, seeing as it’s going to be hanging on your wall next to your desk EVERY day!). We work with a 12-month format – this ensures that the goals are current and relevant, and that you don’t lose sight of what you are working towards.
2. Think Long-Term First – Make sure you have identified your purpose, vision and ideal client before doing ANYTHING else. These will enable you to stay true to your longer term goals, whilst figuring out the 12-month ones.
3. Budget – keep it simple. You don’t need a full breakdown of every cost and sale transaction for the next 12 months – look at your revenue, gross profit, overheads, net profit, drawings and finance repayments. You need basic financial targets to work towards and monitor to ensure the business is performing as it should.
4. Measure – identify 3-5 Key Performance Indicators (KPIs) that you can use to measure your business success. This will be different depending on your business, and where you are in your journey. A startup may focus simply on number of new customers, turnover, profit. A growing business is likely to want to measure profitability, wages:sales ratios, client retention and average client spend. There is a wealth of information on the internet to help with more industry-specific KPIs (both financial and non-financial).
5. Think Worst Case – identify the challenges and vulnerabilities that your business might face in the next 12 months – and, given recent times, it’s good to think extreme situations. Will you encounter any cashflow issues? What happens if your team leave? What happens if you have to close your business? What about if you get sick or injured and you can’t work for a period of time? Identifying these can help you prepare and feel more in control of potential setbacks.
6. Make a plan – set 12 month goals, break them down into 90-day goals, and create a 90-day action plan which will be a list of all the day-to-day actions that you need to achieve in order to help you achieve those 90-day goals.
7. USE IT – this needs to be a working document – not something that gathers dust at the bottom of a drawer. Use it to provide you with clarity and help you to focus on what needs doing. Don’t get distracted by other things – focus on what you want. Hang it up somewhere you see it every day, that you can refer to. Remind yourself of WHY you are doing what you are doing on the days when you want to give everything up. And make sure it’s updated every year. Create a new 90-day action plan every quarter, and keep working towards those goals. Amend the goals if you’ve realised you’ve been too ambitious, or you’ve had amazing success.

Let us know how you get on! If you’re interested in our business planning services, get in touch with us. We offer 1:1 business planning sessions, 4-week group workshops and self-completion services with a review meeting. For existing clients, ping one of the team a message, or book in a Quick Question. We also offer Quarterly Strategy Sessions which help keep you on track, and guide you through the process of creating a new 90-day action plan.