Tips for Updating Your Business Plan
In the last year, businesses have navigated inflation, labor challenges, supply chain disruptions, and economic uncertainty. You have undoubtedly learned a lot about business planning and resilience. With the end of the year approaching, you may be spending time reflecting on this experience and how it applies to the future of your business.
A business plan is one of the many tools you likely rely on to set the strategic direction and priorities for your business. As market conditions change and your business evolves, it's important to look at your plan as a living and breathing document. Follow our tips below if you are ready to update your business plan.
1. Define success
The first thing to ask yourself is 'What does success look like for my business and has that changed?' A lot happens throughout the year, and, as you look at your business plan, you may realize your definition of success has shifted. If that's the case, you will want to consider what goals you need to set to achieve this new benchmark. If your definition of success hasn't changed, you should still spend time reflecting on how you will continue to stay on track. Defining what success looks like will allow you to lay the groundwork for setting your business goals.
2. Ensure your goals are reasonable, measurable, and achievable
Once you define success, you want to ensure your goals are reasonable, measurable, and achievable. You may want to think about this on a quarterly basis for your business. Have multiple people at different levels of your business weigh in on the business goals, especially those responsible for execution. By involving people across the organization, you are more likely to create buy-in and commitment to the outlined goals.
3. Dig into the financials
The financial portion of your plan is important as it helps you map out how to financially sustain the business throughout the year. In your plan, we recommend showing how you will allocate capital, how you will generate revenue, and how you will effectively manage expenses to create reasonable net operating income. This information can be helpful if you are looking to secure additional funding throughout the year.
4. Analyze the macroeconomic conditions and competitive landscape for your business
It's important to anticipate potential changes to the economic environment and your industry in the next year, and plan accordingly. First, we recommend evaluating your operating costs. Will labor costs go up or down? Do you need to cover more overhead costs? What technology needs to be upgraded in the next year? Do you need to borrow money to cover increasing costs? You will want to assess how the competitive landscape for your business has changed. We recommend conducting a SWOT analysis to uncover any opportunities and threats that might impact how you plan.
By updating your business plan, you will determine where you want to go and how you will get there. As you reflect and plan for your business, don’t forget you can always reach out to your partners for guidance.
About the Goering Center for Family & Private Business
Established in 1989, the Goering Center serves more than 400 member companies, making it North America’s largest university-based educational non-profit center for family and private businesses. The Center’s mission is to nurture and educate family and private businesses to drive a vibrant economy. Affiliation with the Carl H. Lindner College of Business at the University of Cincinnati provides access to a vast resource of business programming and expertise. Goering Center members receive real-world insights that enlighten, strengthen and prolong family and private business success. For more information on the Center, participation and membership visit goering.uc.edu.