An important part of your business plan is to state what your goals as a company are. If you are a startup, then you’ll want to project out for several years. For instance you would state your current position and where you plan to be in six months, one year, and so on. You’d list your product or services and explain your growth plans for the listed periods. If you’re an existing business, you would show your current position, and then do the same type of projections.
You may want to start out with some major objectives such as planning to be the largest provider of your product or service in a given area. Maybe you even want to make breaking into the overseas market a goal. You might have a general plan to bring in a certain amount of money within a certain period. These are long range goals, but you need to be pretty specific in your business plan. In fact you should set yearly goals that can be measured against the past year so you know exactly how you’re doing.
For example if your sales are now at $500,000 per year, you would review the past financial period, look at your marketing plan, and decide on a reasonable growth rate. So if you believe that 10% is a reasonable rate of growth then you’d state that in this section of your business plan.
Also in a business plan, you usually project out for three years. If you believe that a 10% increase is a realistic goal for the next year, will it hold up for the following two? There is a reasonable amount of guesswork involved here, but you can certainly look at what market segment your goods or service has been popular with, and check the expected growth in that demographic for the next couple of years. Work with your sales staff to see if there is another group you should be going after.
You definitely want to do your homework here. If you just throw out some ideas and numbers without putting any analysis behind them, then there isn’t much point in creating a business plan. One of its chief functions is to act as a tool for you to realistically map out your strategy for operating. Look at what you’ve done during the last year and use a marketing plan to research potential ways for you to grow. Besides being a kind of map or guide for you, your business plan can renew your excitement about your company.
If you’ve been in business for a while, this is where you look to see how you are doing as far as meeting the goals you set up last year. Take the example of sales again. As you review your plan, you may find that you aren’t making your projections. You definitely want to find out why instead of just hoping you’ll make them in the next year. Look at your competition; maybe they have a better product. Are you targeting the wrong market? Do you need more sales people or are the existing ones just not performing? Maybe your advertising campaign needs reworking. Business plans can also tell you when it’s time to look in another direction or maybe even get out all together.
On the other hand, maybe you’ve gone over your last projections. This is great news, but where do you go from here? Should you stick with the same plan or do you want to increase your market share even more? Maybe you want to add another product or service and enter a new market. If you think this is a good idea, then it’s time to do some research into that area. Was the increase in sales a one time spike or has it turned into something that is showing consistent growth?
As you can see, setting goals and reviewing your progress is a necessary part of a well working business plan.