Written by: Marlene Piche, SVP Head of Branch Banking, Union Savings Bank
Think of the last time you sat back, kicked your feet up and relaxed, fully satisfied with your small business plan and knowing it was accurate and completely up to date. If you chuckled at the thought, it’s because as a small business owner you know that your small business plan is never truly complete. Perhaps your business plan is not even in written form but rather a rumination between you and your team. No matter where your business is in its life cycle, having a business plan to drive and inspire your decision making in 2019 can help put you closer to reaching your goals.
If you are walking into 2019 without a written business plan, or if you have a plan in place that hasn’t been updated in a while, now could be the time to change that. Here are 4 things to consider when creating or updating your small business plan in 2019.
Perform or update your market analysis for 2019
Even if little has changed within your small business over the past year (or past decade), the world around you has been moving full speed ahead. Market trends come and go, values fluctuate over time, new competitors emerge and the economy changes based on many variables. Taking these factors into consideration, a good place to start when updating or creating your small business plan is to perform a market analysis for 2019. Examine the market trends, reflect on any changes in demand for your product or service and investigate how competitors are meeting their customers’ needs.
Consider the impact of changing technology on your projections
While your business may not have undergone drastic changes, there are still many small shifts a business naturally experiences that should be reflected in your plan. As technology advances, so do many of your regular business functions including advertising, customer experience, and recruitment. As your approaches to these tactics change, so may your budget and projections. For example, if you see your staff growing in 2019, are the costs of recruiting online, training and benefits reflected in your projections?
Advances in technology may also have a significant impact on your customer acquisition costs. In many industries, acquiring new customers is largely a digital effort, as are research and lead generation. Making sure that these costs are reflected in your projections and, in turn, your business plan can help paint a clearer picture should you need to apply for a loan or increase capital.
Include any changes in management
Bringing a new member on board your management team can create many opportunities for your small business to grow. It can also potentially impact your future borrowing options. Placing or elevating someone with unique expertise into a decision making position within your small business could make a lender feel more confident when choosing to lend to you.
When you initially apply for a small business loan, one of the criteria a lender will evaluate is your personal credit and the credit of any of your business partners. If over time your leadership changes, your lender will likely want to know what has changed and the details behind any new players within your business. Are they more or less of a risk than your previous team member? Do they bring a new level of expertise or plans for your business that may enhance or detract from your overall success? Reflecting these answers in your small business plan can help you be better prepared to apply for a future loan.
Evaluate today’s costs of doing business
If you have a business plan already in place but haven’t updated it in a while, consider all the ways that the cost of running your business has changed. Between the advances in technology mentioned above to the equipment and products you need to keep your business running smoothly, costs change almost constantly. Whether you are making updates to an existing business plan or starting from scratch, keeping a record of the current costs of doing business in your plan can help maintain a clear picture of what you need. This, in turn, can help you avoid cash flow issues or shortages in capital that could have otherwise derailed your small business.
It’s not too late to start or update your 2019 small business plan. In fact, since your business plan is a living, breathing document subject to change at any time, you may find yourself tweaking your plan all year round. Things like new challenges in marketing, bringing new team members on board, advancements in technology and many more reasons can spark changes to your small business plan. The most important part? Getting started. Putting a business plan in place is not just a practice for applying for a small business loan, though it is an important part. Your business plan acts as your guiding star, helping to inform your decisions and inspire you through every stage of your business operation.
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