‘What’ is your plan?
Let’s make an assumption that you did create a detailed business plan before you opened your business. Your business plan was very detailed. The plan outlined where the business would be located, the hours of operation, the staff working in your business, the management of the business and the ownership. You wrote at length about the products and services you would be selling at your business and how these items would fulfill the needs of those customers you anticipated shopping with you.
The business plan was well written as you took bits of time over many weeks to write and rewrite the plan. If you wrote the business plan before the business opened, you even received compliments for your thoroughness from the lending institution officer who approved your loan.
In most cases, the business plan fulfilled its’ purpose and your copy was put away on a shelf for posterity. Perhaps you wrote the business plan only a short five years ago; my, how the landscape of business has changed in that brief time. And for those that wrote the business plan years ago, there is a good chance your plan has little relevancy.
This would be an ideal time to pull that business plan from the shelf and give it a thorough reading. You should make sure you review each and every segment with a pen in hand to make notations of several items.
You should see where you have strayed from the plan. Having strayed may or may not have been wrong; the important factor is that you understand why you have strayed and knowing how you will address it. You may find you need to get back on track. You may find that the changes in the economic and business environments since you wrote the plan necessitates your making changes. If this is the case, that segment of the plan should be rewritten.
As an example, one of the most important aspects of the business plan to be reviewed is that of the focus of your business. Many businesses have a plan that begins with, ‘Smith’s Business will open at (location) to exclusively provide (products and services) that has been personally selected by Mr. Smith from the best manufacturers and wholesalers in the area. The business will be open weekdays during the hours of 9am-5pm and Saturdays 9am3pm.
When it was written this plan made sense. However, as we look at it today we find the plan is incorrect as the business is likely missing too many opportunities of selling to customers. This type of plan focuses on ‘what’ the business sells. The business becomes defined by what it is selling. As long as there is enough of this type of customer in the trade area, the plan will work and the business will continue.
However, for those that have been in business for a quarter century, you know that even the basic items sold today are substantially different from those offered 25 years ago.
A better chance of surviving and growing will come from a business that pays less attention to ‘what’ is being sold, and more attention to ‘who’ is buying. With attention to the ‘who’, the business is likely to find it will morph to a changing customer.
The business may find that customers are more rushed and wanting to do more of their shopping in fewer places. For the business that has been exclusive to a small category of products and services, this may be the occasion where additional products and services should be added.
It is fully understandable for a reader of this column to say, ‘I don’t want to sell all that stuff. I only want to sell the items I originally sold.’ Our response is that the business is not about the owner of the business and what they want to sell, but is instead about the customer and what they want to buy. The business plan needs to focus on the ‘who’ and not the ‘what’ to be successful into the next decade.
An important part of reviewing the business plan is that the owner should not take the plan personally. It is about a business that is to be addressing the needs of a changing customer. And with that, a new copy of the plan needs to be printed and a commitment made to pay even closer attention to the details as you go forward.