| Many entrepreneurs are not aware of the importance | | | | services you could offer. Many times we overlook or |
| of business planning. Some believe that a Business | | | | underestimate a significant asset our company |
| Plan is something that is hurriedly put together when | | | | possesses: the skill sets and experience of our |
| the company needs a bank loan or is seeking outside | | | | managers and employees. And the great thing is, |
| equity capital. Actually, planning is one of the most | | | | these assets are already there, ready to be deployed. |
| critical business functions; success is very difficult to | | | | Better utilizing them will not cost any additional money. |
| achieve without proper planning. Planning is also an | | | | Small companies are not as burdened with the rigid |
| ongoing function. Because the business environment | | | | hierarchy that large, unwieldy enterprises labor under. |
| changes so rapidly, you can't simply do an annual | | | | Encourage your employees-all of them from the janitor |
| budget, tuck it away in a drawer and say you are all | | | | on up-to contribute ideas that might save the company |
| done with planning until next year. You need to update | | | | money or increase revenues, and be sure to reward |
| your forecast and strategies periodically during the | | | | the employees whose suggestions you use. |
| year, quarterly at the very least. | | | | The planning process also forces you to take a critical |
| The Business Plan document you create can actually | | | | look at how your company shapes up versus its |
| save your business money, in a number of ways. First, | | | | competition, and how the competitive landscape is |
| it can help you reduce expenses. You might start your | | | | changing. Do you know how your products or services |
| budgeting process by building a spreadsheet showing | | | | are priced versus your major competitors? You |
| how much you spent in each major category last | | | | should. Do you know how your products and services |
| year, and then have a column next to that for your | | | | are perceived by customers, versus your competitors' |
| forecast expenditures for the upcoming year. There | | | | products or services? You won't know unless you |
| are bound to be categories where you can cut costs | | | | take the time to ask them. |
| if you think creatively. Changing vendors is one | | | | The planning process also forces you to critically |
| example of how costs can be cut. We all get in a rut | | | | examine your business strategies, and determine what |
| of just paying bills as they come in, without considering | | | | worked, what didn't work and what can be improved |
| whether we are paying more than we need to. | | | | in the coming year. This can be an eye opening, even |
| Categories such as shipping costs, insurance, travel | | | | sobering experience. Continued business success |
| and entertainment, and bank service charges are all | | | | requires an attitude of constantly striving to do |
| areas where researching alternative vendors can lead | | | | everything more efficiently, to improve every aspect |
| to substantial savings. But you have to make the effort | | | | of your product or service offering to keep ahead of |
| to seek out these savings. | | | | your competitors. Companies that are content to do |
| A rigorous planning process can also help you uncover | | | | things the way they've always done them usually end |
| exciting new revenue opportunities for the coming | | | | up suffering a decline in market share and profitability. |
| year. Have a planning meeting with your management | | | | Unfortunately, some the mightiest corporations in |
| team where you brainstorm ideas for new products or | | | | America have had to learn this lesson the hard way. |