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Business Planning - July 18th 2022

Take control of your business

Cash flow is the most important issue in my business

Do you agree?  Many of our other clients do. In this uncertain economy, managing your cash flow is more important than ever.

If you are concerned about future trading conditions, then take some time to reflect on where you are and what could happen in the next few months. It is important for all businesses to plan ahead for a range of scenarios. Cash flow and business planning in these uncertain times may appear problematic, but there are some practical steps you can take to minimise potential disruption to your business:

  1. Review your Budgets and set realistic and achievable targets for the remainder of 2022 and into 2023.
  2. Review and flowchart the main processes in your business (e.g. Sales processing, order fulfilment, shipping etc.) and challenge the need for each step.
  3. Encourage team members to suggest ways to streamline and simplify processes (e.g. sit down and brainstorm about efficiencies and cost reduction). Get your employees involved in a discussion of likely trading conditions and get their input on reducing costs and maintaining revenues.
  4. Put extra effort into making sure your relationships with your customers are solid and
  5. Review your list of products and services and eliminate those that are unprofitable or not core products/services.

We specialise in helping our clients manage their cash flow. We do this by preparing and updating detailed cash flow forecasts using the latest and most powerful software. We can also help you negotiate or renegotiate overdraft facilities and find specific funding to help you grow!

Please talk to us about cash flow planning for the next few months. We can offer a template so you can do this yourself or work together to produce estimates for a variety of scenarios.

Financial Forecasting

One of our director's Mark Johnstone recently talked to Thive, a local business community regarding how to financially forecast and budget in such a fast-moving business environment. Click here if you would like to watch the presentation.

Please do talk to us about helping your business plan forward and protect cash flows, our most successful clients know that the best way to predict the future is to create it!

How to Build your Business Strategy in the Face of Uncertainty

We live in uncertain times and planning for the future is challenging. Rather than paying attention to what you can’t do, focus on what you can do. For example, when restaurants couldn’t serve customers indoors, they transitioned to delivery, take-away and outdoor dining. Regardless of the type of business that you manage, this is the mindset to develop and use for your 2022 business strategy.

Your “can-do” business strategy should start with a list of what is possible. Perhaps you can transition to doing business online, research new markets, or utilise the shift to video conferencing to create a new and more personal experience for your customers while they are in the comfort of their home. Once you have considered what you can do, you can then create some strategic objectives for the year ahead.

Consider how you can shift your business strategy to one that is more customer centric. The best businesses are those that deliver added value to their customers. For example, you could provide new payment options to customers in order to encourage them to make a purchasing decision. Your customers will be more focused on cash flow due to the prevailing economic uncertainty, so offering structured payment plans, 12 months interest free credit and so on, could make your firm more attractive than your competitors.

If you are considering launching new products or services in 2022, you may need to extend the timeline. The world is not back to normal (whatever the “new normal” is) and supply chains are struggling with issues related to transportation, production backlogs, availability of materials, etc. As such, it would be prudent to allow some extra lead time in your plan for any new product or service launch.

With an uncertain operating environment anticipated to continue for some time yet, it makes sense to have a backup plan. As you develop your strategy, take some time to consider what potential contingencies you can put in place in order to be ready to move in a different direction, should you run into some headwinds. If you are unsure where to start, it can be helpful to research some of the tactics that worked for other businesses, even those that may be operating in a completely different sector. You can then apply the best bits of those tactics to your own strategic plan.

As you develop your business strategy, you will most likely identify some actions that you can undertake with certainty, which will help you to manage some of the risks that are inherent in operating in uncertain economic times. Perhaps you can bolster your firm’s cash reserves, reduce fixed costs, or negotiate better terms with suppliers. By proactively focusing on delivering against these actions, you will keep moving your business forward, which will help to make your firm more resilient in the medium to long term.

We were finally getting over the financial crisis when Covid struck. Then, in the trough of the worst economic downturn in 300 years, we discovered that recovery was driving the Financial Times Stock Exchange (FTSE) to new heights and the job market into a frenzy. In the wake of that, it became clear that the recovery was overheating and that we were facing a period of rising inflation and industrial action

Russia’s war in Ukraine made things worse. It has not only meant human suffering, but it has also affected the entire global economy, driving up the cost of food and energy. It adds to the hardship for those on a low income and means serious food security risks in the world’s poorest economies.

The economy has always had its ups and downs, but its resemblance to a roller coaster is currently more marked than ever with the news of Prime Minister Boris Johnson’s resignation and the race for his successor.   

Businesses of every size face challenges that are now suppressing growth. A business might have a great product or service, but without a strategic plan to help it define, articulate and communicate where it is going, it will be at the mercy of outside events. We encourage our clients to take some time to think long-term about their business and to establish goals or targets that you can control.    

A plan starts with identifying and accessing opportunities within your market and should address how your business is going to evolve to meet the challenges of today and the future. The plan gives your business purpose and it answers questions about your long-term goals.

The first step is to look at five important areas:

  1. Think long term – invest time in understanding where the market is going and what this means for your customers. Short-term decisions do not help grow a business.
  2. Having a good value proposition is essential – this states the relevance of your product or service, what it does and why customers need it. What is yours? 
  3. Expand your reach – what is your target customer and what do you need to do to let them know you exist and that your product or service is relevant to them?
  4. Growth means new people, systems and (maybe) different ways of doing things. Grow at a pace you can manage.
  5. How will your marketing get your value proposition to relevant customers?

Once you have taken some time to write out your plan and where you want your business to be in (say) 2 years, the next step is to work out a marketing programme with actions to make it happen.

A marketing plan is a business document outlining your marketing strategy and tactics. It is often focused on a specific period (i.e. over the next 12 months) and covers a variety of marketing-related details, such as costs, goals and action steps. But like your business plan, a marketing plan is not a static document. The plan should outline:

  1. How you are going to keep existing customers happy and returning to buy more often.
  2. What the goals are for getting new customers.
  3. The marketing methods you are going to use to achieve points 1 and 2.

We specialise in helping our clients manage their businesses. We do this by preparing and updating detailed forecasts, using the latest and most powerful software

Please talk to us about strategic planning. We can provide a template so you can do this yourself or work together with you to produce estimates for a variety of scenarios and help you take control of your business!