Oct 2022 The Benefits of Planning Your Business Growth
Considering the challenges of the last 12 months (rain, COVID, increased materials costs), some business owners might think it is hard to plan business growth. They might say “I am just trying to organise my business from week to week, and maintain reasonable productivity due to the unprecedented rainfall”. However, I believe these challenges only increase the need for planning business growth! Please read on.
Why do we need a plan for growth?
Running a business has its challenges, even when the weather is fine. I believe every business should have a plan for the financial year, and it starts with planning your sales and profit (also known as a financial forecast), but it doesn’t stop there.
Consider this – You wouldn’t want sales to be the same in this new financial year, as they were in the 2022 financial year, because wages, subcontractors fees, fuel costs, materials, and other costs will most likely increase – therefore you will need your sales to increase also. Many landscaping businesses grow every year between 10% and 20%, so organic growth is happening anyway.
But, I believe your financial forecast or your sales/profit plan should also have a plan for the processes, systems, developing team members, quoting, and project management.
Because when you plan your sales and profits, it sparks the question, “how do I achieve the intended sales and profits?” and “What areas in my business need attention or improving?”
One example might be; to deal with heavy rain, you can increase quoting mark-ups, use heavy-duty tarps to work under, ask employees to work on Saturdays or longer hours on drier days, and utilise days in lieu.
Another example is; I need to build fewer (and hopefully zero) of the wrong jobs. You might tweak your qualifying clients process so that more complicated projects or clients aren’t quoted. In other words, if the project doesn’t feel right, don’t quote them.
So what are the benefits of business growth?
- Creating a realistic plan means you will have definite goals for the year that create enthusiasm, and we all need that when COVID and the weather can interfere with weekly activities
- Your enthusiasm will positively affect your team, your associates, and your clients
- It’s great to communicate the intention for the year to your team. You wouldn’t be talking about specific sales and profits, but the overall plan. A happy passionate team that are working towards some inspiring business goals can help to unify everyone
- Improved systems and procedures improves efficiency, and the way in which everyone works
- It sets the path to offer a profit share system
- Your clients and the projects that you choose to work on will be more aligned with what you want
- Increased sales and profits
What can it mean if you have no plan for business growth?
If a business owner is thinking “let’s just keep operating the way we have been, and we’ll get through the next 6 months”, it will leave everyone feeling a little flat. With inflation increasing, we all need to plan our sales/profit growth to ensure we are in a good and stable position throughout the year. Also, no plan can have a negative effect on the owner because he adopted the attitude that he needs to just keep everything together, rather than be proactive and plan better processes, sales and management.
So, a business should always be planning its growth and improving systems to assist growth being realised. The enthusiasm that is created from a proactive approach will benefit every aspect of a business.