How do you get started? It's important to realize there are many different ways, and the best choice for you depends on the way you like to work.
In Start with the Review Schedule , my March 2008 column, I suggest that you start by setting the review schedule. That's still one of my favorite starting points, because it sends a clear message about what the planning is about and how it'll help your business.
However, maybe you're a concept person, a strategic thinker. That's great. Stick with that, and start your planning with what I call the heart of the plan, the core strategy. Take a step back from your business and ask yourself four key strategic questions:
- What am I really selling?
- How do I want my customers to think of my business?
- What am I really good at? What do I (my company) do better than anybody else? Am I correctly focused on that core competence?
- What do my customers want that I'm not giving them?
- Do a sales forecast. Break your sales into components, such as specific products, groups of products, channels or buyers. Project it if possible into units, price per unit and cost per unit (not always possible, but a good idea when you can do it). You'll discover that as you project your estimated sales, you're thinking about some of the core strategy questions above, which will be implicit in your numbers. And once you have a sales forecast, you can start tracking results, which leads to your planning process.
- If you're a startup company, estimate startup costs. That includes expenses that occur before your first day of business, such as legal expenses, fixing up a location, developing prototypes; and the assets you'll need to start, such as equipment, starting inventory, and--oh, yes--cash in the bank.
- Estimate your expense budget. If you like, call it a burn rate. What do you think you'll be spending for rent, payroll, utilities, marketing expenses and everything else? As with the sales forecast, this gives you something to track, so you can start planning.
The key here is to get started and get going. People are different, so start anywhere you like; it won't matter. You'll fill in the rest when it's needed. This way you'll be able to see results quickly, and that will help you stay motivated as you do your planning.
The author is an Entrepreneur contributor. The opinions expressed are those of the writer.
Credit to Tim Berry.
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