Planning for 2010 – First set your Destination

Now is the time to be planning for 2010.

Many businesses have survived 2009 by cutting back wherever they can, laying staff off, cutting marketing and in some cases dropping services or products from their offerings. In some circumstances this can be sensible and even unavoidable but there comes a point where you should get back into positive development mode.

Most pundits agree that the economy is going to be difficult for some time ahead but that 2010 will be better than 2009 – so what are you doing to make 2010 a good year for your business?

My clients are now working on their plans for 2010 and the most important part of that process is to decide where you want to be at the end of 2010.

Would you try to plan a route without knowing your destination? Of course not.

Business planning is the same.

It used to surprise me how many business owners and directors turn up to work each day and do whatever needs doing. These people end up wherever they end up – they are the ones who wait for their accountant to tell them whether or not they had a good year, always assuming the bank has not closed them down in the meantime.

Without a longer term plan how can you set short term direction?

So – first set your longer term plan then decide where you need to be at the end of 2010.

Next consider how you will get there.

Do not assume anything. 2009 has caused many people to take a long look at what they are doing and how they do it – have you gone through this exercise?

Review your Business Model – how could this be improved? Could franchising or licensing be an option for developing using other people’s cash and resources?

What could you be doing differently now to meet one or more of these objectives?

• market needs have changed in recent time
• you can provide the same or better service at a lower cost by doing it differently
• you can offer your customers something better by doing it differently – an excellent way of protecting your market share and increasing your share by taking business from those who stand still
• taking advantage of new technology to reduce costs and/or improve service
• sell more to your existing market place and customers
• find new market places for your existing range of services or products
• market more effectively – ie use a different method to get your message to your target customers more cost effectively, especially using digital marketing which can be targeted and low cost

Get your management team and your staff together – engage them in this exercise – there may be some great ideas they have that you could adopt or use as the basis of change. Challenge them as well as yourself to find improvements to implement in the next few months.

Once you have identified your destination and the things that you will do differently, prepare monthly P&L and Cash Flow forecasts.

Do a reality check – can you operate within the projected cash flow?

Is the projected level of profitability satisfactory? If not, revise your plans until they are right for you.

Set targets to improve sales and profitability and do some “What If” calculations.

Then prepare your marketing plan to generate the leads you will need in order to hit your sales targets. You will need to know your conversion rate for leads to sales to do this. Cost your marketing and check it against the marketing budget you put into your financial projections.

Review your sales process ie how will you close the enquiries/leads you have generated into sales? Review your sales team and individual performance. Reality check – how confident are you of hitting your sales and profit targets?

[Tip: Check your sales team remuneration package - are you motivating them to bring in the results you need eg if they are commissioned solely on sales, are they discounting in order to sell more so that they get their commission but you do not achieve your targeted margin and profit? Clients have significantly improved profits by spending some time getting this right.]

Break your sales and profit targets down and allocate to each person involved in sales – give them each their personal sales and profit target and monitor regularly.

Do the same with whoever is responsible for marketing ie lead generation.

This way you can monitor that you are generating the leads and converting to sales in line with your targets. If not you better do something about it.

Do an Operations Plan ie how will you deliver the targeted sales at a consistent high level of customer service? How will you measure the service you are providing?

Review your Management Information Systems – are they providing the data you need daily, weekly and monthly to monitor and manage your business and take decisions? Are your systems set to provide this information accurately and simply (ie cheaply)?

[Tip: Is your Chart of Accounts as per the accounting package you use for your management accounts or has it been set to match your business streams so you get the data you need at the touch of a button? Clients have improved their profitability by having the right information easily available.]

What other system issues would improve the effectiveness of your business and help you deliver consistent high quality service?

Look at your People Plan – are the right people doing the right work? Is your work flow the most efficient it could be? Will you need additional people at some point? If so will you recruit or promote from within? Have you got training and development plans? Succession plans? What training and development have you planned for yourself?

[Tip: Most importantly - are you freed up to focus on the areas where you make the biggest impact in your business or are you wasting time doing stuff you should not really be doing? If so, why? Clients have improved profits after they used a simple method I have developed to assist them to delegate everything they need to in order to focus on thee where they make the biggest impact.]

And now – a biggie!! How good are your leadership skills? How will you lead your team to ensure they hit all the targets you have set? Is there anything you could be doing to improve your leadership skills? How can you improve results?

FINALLY,

After following these steps and tips you should have a set of plans which all hang together and you should also have the means to monitor progress in order to make any adjustments in the light of positive or negative variances.

You should be on your way now to a great 2010.

As usual, if you want to follow up anything here do please get in touch by phone to 01423 550787 or email me at Profit@nextlevel.org.uk or visit our website to see how we can work together.

Have a good year,

Brian

Brian Allmey, Next Level Business Solutions Ltd

Charles Darwin and business today

Charles Darwin is often mis-quoted as having talked about “Survival of the fittest”. What he actually said was “It is not the strongest of the species that survives nor the most intelligent but the one most responsive to change”.

In business this was never more true than today, whether you are a small concern, an SME or a major player.

If you are still doing what you did two years ago or even one year ago it is probably wrong. Let me qualify that. It’s not just what you do but how you do it.

For some of us it may well be fine to still be doing what we did a year or two ago but is there now a better, more productive, more efficient or lower cost way of doing it? Can we do it in a way that provides a higher level of value or service to our customers?

For other businesses, they may well have to find new things to do in the light of the changed economy. For example, electrical contractors who relied on doing a fast efficient job of wiring new houses had to quickly find alternative work or else lay off skilled workers or go out out of business.

Recently I have been working with clients who wanted an outside pair of eyes to help them review their business and spot the things that they no longer notice. Often I can suggest opportunities for savings such as outsourcing a department for a larger client who could save a net £200,000 pa in that way or a smaller client who refocused their marketing on activities which had been proven to deliver profitable business. In other cases I have been able to suggest new markets for existing products and new sales channels to boost sales and gross profit, often with little or no impact on overheads and so resulting in a boost to bottom line profits.

Often benefit can be gained by reviewing the Business Model and for example, as I did for a client recently, licensing the sales function so that instead of employing additional salespeople with the costs and risks that entails, they have licensees paying them to join the organisation, paying for their own training and taking a commission on sales they generate ie no cost to the Company if they do not sell.

If you are not positively looking for change, for new and better ways of doing things, your competitors are likely to overtake you so what are you doing to make sure you are one of the species that survive?

Contact us today to arrange a Business review and start the ball rolling to do things differently and better and more profitably.

Do not be one of the Insolvency Statistics – 60% Grant Aid towards support fees

We all know that business insolvencies are rising for major businesses and for smaller businesses. In every downturn there are winners and losers – the difference can be in your mindset and the action you take.

Part of my work involves me spotting opportunities for increasing profit through increased sales or margins or through reducing costs or by doing things differently and more effectively. A fresh pair of experienced eyes can spot things the management team may be overlooking and can bring new ideas or reminders of things you always planned to do but never got round to.

This is especially important when times are tough and you need every advantage you can get.

Last month Nokia senior management commented that most innovations come during tough times and these help to retain or increase customer base. I have seen clients re-examine what they are doing and finding faster, easier, cheaper ways of doing things that often increase the service to customers and offer something different. Are you doing this?

Right now there is Grant Aid available which can cover over half of my fees, meaning my services cost you less than half the normal rate. In addition, if cash flow is an issue, I can arrange for you to pay project fees over 24, 36 or 60 months and you will still qualify for Grant Aid.

Franchising all of your business model or Licensing part of your business can be a very effective way of growing with minimum cash outlay and my fees for this work also qualify for Grant Aid.

If you want to be successful, are serious about developing your business and you are open to new ideas contact me today to arrange for a Business review meeting to see how you and your business can benefit from the Grant Aid now available.

Best wishes for a successful year.

Brian Allmey

Thank you

Thank you Jess Kemp of InTune Media for your help in setting up my blog and getting me started – couldn’t have done it without you. I recommend anyone who needs a hand in setting up or using a Blog or a Twitter account to contact Jess.