5 Astounding Points to Consider After Creating Your Business Plan

Every year, more than 10 million business plans are written worldwide to raise capital. Business planning is often seen as a purely financial exercise. You spend hours crunching numbers and tracking cash flow, only to conclude that you don’t have enough money to build the business you want.

While this is true to an extent, business plans are also about much more than just money. They can give you a clear financial picture of your company’s viability—and they should help you identify any potential red flags along the way.

Business planning also acts as a framework for how you will run your company day-to-day. It outlines who your target audience is, what types of products or services your company will offer them, and how you will reach them.

If you have an idea for a new business but aren’t sure where to start, take note of these 5 considerations after creating your business plan.

1. Set SMART goals once the business plan is created

Goal setting is perhaps the most important activity after creating your business plan. It’s the framework for the business roadmap, and without it, you’re missing a key piece of the puzzle.

SMART goals are clear, measurable, achievable, relevant, and time-bound. They must be specific enough to be achieved. You should also set SMART goals that are relevant to your business aims. You should then aim to set a number of SMART goals once the business plan is created.

For example, your goal to launch a new product within 12 months is an ambitious one. But what does this mean in practice? A major milestone you should reach before launching is having a product that’s ready to enter the market.

SMART goals help you to turn the business plan into actionable steps and bring structure and clarity to your busy agenda.

2. Highlight Risk Areas in Your Business Plan

Business plans are an opportunity to highlight areas where you have or might have to face challenges in your business. These challenges may be financial or otherwise. Are your financial projections realistic? Has your business plan been audited? Sadly, many businesses are launched with false claims and unsupported assumptions in the business plan.

While you might have a great product, it’s helpful to highlight any potential risk areas in your plan. You can do this by consulting a trusted accountant, an attorney, or another business advisor. Ideally, someone who has experience in the field of startups.

You may also encounter risks that are external to your business and, as a result, may impact its growth. If you are entering a highly competitive market, for instance, you may encounter some inherent challenges when starting up, such as a lack of brand recognition. Other common external risks are macroeconomic factors, such as rising interest rates, and external factors, such as a lack of consumer interest in your product or service.

Scenario planning can be a great tool to understand and incorporate the risks into your business plan and future activities. If a risk is too significant, use it to your advantage. Find a way to mitigate it or turn it into an opportunity.

3. Decide Where to Source Your Products and Services

One of the first things most business owners do after drafting their business plan is to look at potential suppliers for their products or services. As discussed in detail in point number 5, however, this should be a very early step in the business planning process.

It’s very easy to get caught up in the excitement of finding a suitable product or service for your new venture, and to end up starting your new business with the hopes that things will somehow take care of themselves. To avoid this, you must first determine where you will source your products and services.

If you are planning to sell your own products, you may be able to find suitable suppliers in your own community. But if your plan is to operate as a outsourcing business, you will have to look beyond your immediate region.

It’s typically better to source your products and services from outside suppliers, particularly in the early stage where you have limited resources. This will save you money and time, and ensure your products meet the highest standard.

4. Building a Team? Identify Core Employees

Before you start hiring employees, you will want to evaluate what kind of team you’ll need to be successful. Do you need experienced professionals, who are rather expensive at this stage, or just interns or fresh university graduates? Ideally, you will want to round out your business planning with a clear idea of the team you’ll need to run your company.

This could involve hiring employees, or investing in training them in-house. You may also want to consider buying an existing business, or joining an incubator or accelerator. This will help you identify core employees.

You should ask yourself what roles do core employees play in your business? These employees should form your core management team. They will be the individuals who will make most of the day-to-day decisions in your company.

Ideally, this will be those who will be present throughout the lifetime of your business. This could include partners, key employees, and investors.

You may also decide to include one or two investors who are not involved in day-to-day operations as advisors.

5. Track key performance indicators

Lastly, you may want to track key performance indicators. The business plan is an opportunity to track key performance indicators. These are key indicators of your company’s success at the operational level.

Key indicators can be tracked using a management dashboard such as that provided by G2 Crowd. For example, you can track key indicators such as incoming revenue, outgoing revenue, customer retention rates, customer lifetime value, and expenses.

For instance, you may track how much revenue your company is generating each month. You may also track your customer retention rates, and how many customers you have each month.

You can also track indicators that relate to the growth of your business, like the number of new customers you sign up each month.

Is tracking these metrics a one-time exercise? No. Instead, use them to identify potential trends or issues. And, use them to set new goals, or adjust existing ones.

Conclusion

Building a business plan is an important step on the road to success. But don’t stop there. The plan you create needs to be implemented and managed accordingly. Without proper management, the plan will fail before it gets off the ground.

Business plans are helpful tools, but they’re just that: plans. They’re not a license to get away with bad management practices. Instead, they can serve as a roadmap for success.

Once you’ve created your plan, take the time to read it carefully. If you want to get the most out of your plan, you’ll want to constantly revisit it and make adjustments as necessary. You’ll also want to make sure you’re implementing your plan as intended.

Above all, remember that business plans are just that: plans. They’re not a set-in-stone guide to success. They’re a set of guidelines, or blueprints, for success. It’s up to you to make sure that blueprint is complete and accurate.