Making predictions is hard, especially about the future of the economy… and especially in volatile times. A business plan to rock the rest of 2021 should incorporate what you think lies ahead, along with a “plan B” if things don’t go the way you expect.
While the outlook for the rest of 2021 appears bright thanks to significant progress in beating back the COVID-19 pandemic, there are no guarantees of enduring boom times.
A variety of events can throw the recovery off course, but the business lessons you learned in 2020 can steer you forward. Here’s how.
Lessons learned in 2020
These lessons include how to communicate with and serve customers in different ways, new staffing models, and steps to cut operating costs dramatically.
These learnings are applicable even if the economy continues to build strength. Take a few minutes to reflect on what your “lessons learned” are and their relevance going forward.
For example, say you mastered effective communications with customers even when your business was in the doldrums and while everyone stayed home. In a resurgent economy, supply chain bottlenecks and a tight labor market might challenge you to meet your customer’s needs in the short term. So staying in contact with clients may be just as necessary to maintain those relationships as it was during the depths of the pandemic.
2021 business plan components
Reminder: Your business plan is your flight plan for your business. It should be looked at on a regular basis so you are always working for your strategic goals. Regardless, a refresh of your business plan for the remainder of 2021 (whether you have one currently or need to start fresh) is necessary. Here’s what to look at:
Analyze your marketing and pricing strategies
- Seasonal marketing efforts. If customers and prospects expect seasonal offerings (like a “sales event”) from your business, take a proactive look at your marketing campaigns and make sure they are still appropriate or update as needed. As more consumers enter the economy, it’s time to get their attention.
- New product and service initiatives. If your customers are more inclined to open their wallets through next several months, are there any other products or services that would appeal to them now?
- Pricing strategies. If you’ve been holding the line on prices, your business plan can include testing the waters with a more aggressive pricing strategy.
How to plan for updates and growth
- Growth. Unfortunately for some businesses, 2020’s challenges dealt a crippling blow to their long-term survival prospects. But if you landed on your feet, you might spot a merger, acquisition, or new partnership opportunities with competitors. In general, larger companies can weather economic storms better than smaller ones, because they have more room to contract during dry spells.
- Technology upgrades. It might be easy to defer IT updates when business is slow. But if you get too far behind, you’re delaying the opportunity to operate more efficiently, securely, and gain new capabilities. With the latest in business automation tools, accounting, HR, CRM and marketing systems, among others, you may set your business up for future success. (Note: A survey of more than 1,000 finance executives commissioned by Sage found that 77% are planning to beef up their investment in IT this year.) It’s not an all-or-nothing proposition, however. A business plan can prescribe a phased approach to updating your IT functionality.
- Staffing. Many employers in recent months are struggling to attract workers at the lower end of the wage scale. The causes are varied. Generous unemployment insurance benefits have played a role in some areas, but those are being phased out. Still, labor market dynamics are shifting, and you might need to increase your wages, or find other inducements, to staff up as business picks up.
- Real estate. The pandemic might have prompted you to think about your real estate needs. For example, if employees worked productively from home and want to continue this, should you cut back on square footage and reconfigure the space you keep? This is a good time to analyze real estate needs and add it to your business plan.
- Financial strength. A cash flow forecast isn’t a business plan but may point to the need to incorporate a capital-augmenting component to your plan—particularly if you have growth in mind. Borrowing costs won’t remain low forever. You might explore your financing options to assess whether you should build some borrowing into your business plan.
Essential ingredients for rocking the rest of the year
If the pandemic taught business owners anything, it was the importance of creativity, flexibility, and perseverance. A good business plan should be created and maintained with those three qualities in mind.
Creativity requires not only imagination, but a willingness to try new business strategies with faith and optimism.
Flexibility and its cousin agility require the ability to make a course correction promptly when the evidence dictates its necessity. And persistence, the flip side of flexibility, means having enough faith in your business plan to not change course on a whim. Add it all up and you’ll have a formula to make your business rock around the calendar.
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