Strategic planning is important for all firms, but especially for growing businesses. Thirty per cent of new businesses with 4 or fewer employees don’t survive beyond their first year. By year 3, more than half are gone. Ten per cent of medium-sized businesses (5-99 employees) don’t survive the first year. By year 6, half are gone.
However, it doesn’t have to be this way!
If you have a valid business, providing value to customers, you do not need to fail. In order to compete with larger businesses that can beat you on price, entrepreneurs need to be able to find their niche.
How is this accomplished? With a proper business plan!
There are 3 components that go into a proper strategic planning project:
- Where are you now?
- Where do you want to be?
- How do you get there?
Strategic planning gives you a clear idea of direction and helps with a variety of the elements of your business, including resource planning (financial, HR, IT etc.), making day-to-day decisions, motivation and vision, employees, clients and bankers and suppliers; but perhaps most importantly, it gives you the direction you want for your business.
Without a proper business plan, you risk:
- A lack of synergy
- Confusing the customer
- Diluting your focus
- Straining financial resources
- Hurting credibility
Having said all this, as most entrepreneurs would tell you, you may need to change direction every so often. For example, there once was a very successful typewriter company that saw no need to change their strategy. That company became obsolete with the success of the personal computer.
We will talk more about how to evolve your business plan – and your business as a whole – in a future blog here at Beal Business Brokers and Advisors.
For more business plan tips, call Beal Business Brokers and Advisors today at 204-478-7266, or fill out our online contact form here.