Efficient Business Planning In Challenging Times

All businesses, big or small, face various challenges time and time again during their business journey. What sets successful businesses apart from failed businesses is the way they deal with and overcome obstacles. Various stages and aspects of business planning help businesses prepare for challenges and cope with them in the best possible way. Let’s have a look at how various stages of business planning help businesses survive and thrive through the challenges.

Do your research

"Research teaches a man to admit he is wrong and to be proud of the fact that he does so, rather than try with all his energy to defend an unsound plan because he is afraid that admission of error is a confession of weakness when rather it is a sign of strength" - F.H.E. Stocher

Some early misconceptions amongst newbies in the business world are that their business idea is foolproof, that they have thought out a solution to every possible problem that may come their way, that they have enough finances set aside to kick-start a business and that no one can do what they do better than them. These misconceptions are a product of lack of research and planning and contribute to those businesses closing down in their first year and 50% within the first five years.  

Consider the following to prepare yourself for your business journey ahead:

• Brace yourself for a lifestyle change

The shift from working as an employee to starting an entrepreneurial venture is a shift of lifestyle. The responsibility of owning and running a business might sound very exciting and empowering, but it is also a huge responsibility. It is very important that you are aware and prepared to make this lifestyle change before jumping into the business world.

• Assess the market demand

Before introducing a product or service, it is vital to analyse if there is a demand for what you are offering in the market. Numerous businesses face challenges in terms of audience relevance and technical incompatibility when they launch without researching the market. A product, market and audience analysis can save you from the threat of business failure through making these mistakes.

"People are the most important thing. Business model and product will follow if you have the right people" -Adam Neumann, Co-founder of WeWork

“Success isn’t always about greatness. It’s about consistency. Consistent hard work leads to success. Greatness will come” – Dwayne Johnson

• Consistency is the key

As a business owner, you must understand that the progress and growth of your business is dependent on you. You will ultimately be responsible for the positive or negative development of your business. A lot of businesses close down, not because they run out of money or time, but because their owners give up when faced with challenges. Focus on building personal staying power through consistency, maximising your skills and understanding of your business - use this knowledge to bring improvements to the areas that lack success.

Hope for the best but prepare for the worst

You can do everything right in business and something is still bound to go wrong. The sooner you understand that, the more prepared you can be for possible setbacks and hurdles. You've made a plan, you're executing your strategy and you’re living the dream.  Until that is, someone or something moves the goal posts and you're faced with the unexpected. How? Well, the most obvious example would be the Covid-19 pandemic that has slowed down numerous businesses and forced others to close their doors.

“For me, the hardest thing about running a business is managing expectations. In our industry, lives are on the line so it’s easy to get caught up and overwhelmed. I try to remind myself that the reason I started my business was to provide the best addiction care possible. Anything else is just a bonus” - Jerry Haffey, Ambrosia Treatment Center

Even if you are prepared for all possible scenarios, you need to get used to the fact that you won't be able to plan for everything in advance and things will come your way which you'll have to deal with there and then. As a business owner, you may find this element hard to deal with, but it's a hard fact and something you won't be able to avoid.

Financial planning

One common reason for businesses closing down in the early years is financial constraints. This happens despite making financial plans in the beginning. Why? Well, most entrepreneurs prepare overly positive financial plans. Often, the urgency to pursue a business idea leads to an inaccurate financial plan; which instead of helping you set your financial goals, tends to overshadow your business’s realistic financial needs.

Most of the financial plans that have not been checked by an expert, usually overestimate sales and underestimate business costs.  If you want to convert your brilliant idea to achieve a flourishing business, it is important that you make a sound financial plan - including the financial estimate of unexpected costs, business losses and a realistic number of sales. It is then worth getting it reviewed by a business coach or advisor.

“Take whatever amount of resources you think you need to start a business: time, money, etc. and double it. Triple it because that’s the reality of business. Even with a well-thought-out business plan, always expect the unexpected. When I started designing the first collection for Nantucket Kids, I thought, I need to set aside the time and funds for the summer collection and then for the fall collection. Not true. That’s not how the fashion industry works. You need to prepare at least a year ahead because retailers are placing their wholesale orders up to a year in advance for their inventory for the following year. This was something I hadn’t given consideration to because when I first launched the business, I hadn’t planned on taking wholesale orders. Now that Nantucket Kids is available in stores, the amount of planning, time and funds needed is trifold” - Andrea Romito - Nantucket Kids

Growing your business without compromising the quality

Numerous small micro/small businesses are successful because of these key factors: the personal connections that they have with their clients and the attention to detail that they offer. However, with the passage of time, almost all businesses need to scale up. Scaling up comes with its own set of challenges. One of the many challenges is losing the personal touch and compromising quality. The very factors that are a catalyst of business growth become its challenges. This might seem a tricky situation to deal with. Most businesses aim to expand in time, so you can’t just halt business growth because it compromises quality. This doesn’t mean that business owners should be ready to compromise the quality of the product/service they offer. This means that business owners should come up with and implement more effective ways to ensure quality control.

• Hire and train staff

A lot of entrepreneurs think they are the best at what they do and have a difficult time delegating work to employees. The best way to tackle this is to take the lead of an employee team and train them in a way that the quality of work doesn’t get affected.  

• Don’t lose the personal touch

While you might not be able to offer the personal services to your clients/customers due to business expansion, your employees can. Train your staff to reflect the same level of connection with your client that you do when dealing with them.  A strong public relations strategy can also help you achieve this goal. 

• Finding the balance

While your team might not be able to produce the exact quality of work that you do, as far as it’s acceptable, learn to make a compromise. Remember, you need to trust your team in order to generate results and also to retain them. Micromanaging not only consumes a good chunk of your time but also leads to unhappy employees.

Adapt or crash

One area of business planning involves being ready to adapt to the industrial, economic and market trends. In the fast-paced era that we live in, where we are faced with fierce competition, if we fail to adapt we won’t be able to survive. This is especially true now when the world economy is so severely impacted by Covid-19 lockdowns across the globe. While these lockdowns have limited some businesses geographically and physically, now is the time to make the shift in your business strategy and adopt one that has minimum effect given Covid-19 limitations. Here are some examples:

• If you are a retail business, switch to e-retail
• If you are a food business, offer home deliveries
• If you are a service provider, see how that service can be offered online
• Physical trainers, artists, business coaches can potentially offer online sessions
• A lot of clothing businesses shifted to the production of masks & PPE along with their regular production

As a business owner you must be able to see an opportunity in every challenge, this is a great time for businesses to fully explore the options of making their business technologically and digitally efficient. Once businesses realise that switching business online can actually save a lot of money and help them grow, most of them may not consider going back to just an offline existence.

In conclusion, you will be faced with numerous challenges on your business journey, but if you have a sound business plan that focuses on all aspects from research to marketing and financial management, you will be able to survive even the toughest challenges.