By Ron Sturgeon
Chapter 2 of my book, How to Salvage Millions from Your Small Business, discusses making a plan and understanding your customer. It’s funny how we wave our arms in the air (figuratively speaking) and talk about what we are going to do, but never get around to putting the plan on paper. Equally humorous is how later we have selective memory and justify our lack of success by remembering only what we want to recall from that plan.
There is no substitute for putting the entire plan on paper for these reasons:
• With the plan on paper, you can show it to key employees for comments and ultimately use it to get their buy-in.
• You can show the plan to your banker and gain great respect. You may want to “dial it back” for the bank so that you can always exceed the banker’s expectations.
• In the process of putting it on paper, you will find many assumptions you thought you understood but which don’t play out as anticipated.
• Putting it on paper will force you to go back and look at prior periods to “test” your assumptions. You will learn a lot from this exercise.
• You will probably realize, as a result of putting it on paper, that you haven’t been gathering all the operating information and metrics necessary to make fully informed projections.
Setting goals on paper will also allow you to set milestones. In other words, if you are now at $100,000/month in sales, and you are predicting that you will be at $135,000/month in 12 months, it’s easy to see that you need to have one or more milestones along the way.
Although you may not have achieved 50% of the forecast increase in six months, it’s reasonable to assume that you will have achieved, say, 40% of the goal. If at that point you haven’t achieved the milestone, you need to figure out how to get back on track. Don’t wait until year-end to adjust.
When I do consulting, I frequently find the lack of operating metrics and no written plan to execute against.
Know your customer.
Meet with your staff, and decide who your core customer is.
Following that, in every planning meeting, make sure you are matching your product, warranty and service level to that customer.
Recyclers, I believe, have tried to be too much for too many for too long. Many of us believe anyone driving a vehicle (regardless of age, whether it’s import or domestic, customer’s location, wholesale or retail purchaser, or type of part needed) is our potential customer. To thrive, and achieve significant success, you simply must decide who your core customer is and act accordingly.
Remember, only you can make business great!
Helpful Starter Questions
Here are the essential questions you should ask of everyone in your company:
1. What business are we in?
2. What is the vision and mission of the company?
3. Who is our customer?
4. What does our customer value?
5. What is our target market?
6. What products and services do we provide?
7. What is our sales and marketing strategy?
8. Who is our competition?
9. Who do we have? Who do we need? How do we find more of the right people?
10. How will we on-board, train and develop new people?
11. Do we have the physical plant and equipment we will need?
12. Do we have the capital we need? Will we generate the profits we need?
13. How will we measure our success?
14. What is our exit strategy?
15. What are our short and long-term goals? – www.strategictalentmgmt.com
Ron Sturgeon, speaker and author, regularly shares his expertise in strategic planning, capitalization, growing market share, and more, providing his field-proven and high-profit best practices. Reach him at 817-834-3625, ext. 232 or email RonS@MrMissionPossible.com.