Sometimes the economy makes it harder for individuals to start or grow a business. But another factor that hampers businesses is a lack of business planning. Business owners can be so busy trying to start or keep their business going that they have little time to do business planning for the future.
Here are some essentials for business owners to plan for to increase their chances of success.
- Funding – Most businesses need to make sure they have saved enough to help them get through slower sales periods. The best way to set aside funds for this purpose is to factor a dollar amount into your monthly budget.
- Insurance – Some businesses have failed because they weren’t adequately insured to pay for losses from a disaster. Business insurance and life insurance are essential to keep any business up and running during difficult times.
- Savings – Piling money in the bank or making investments to create future funding is important. Not all the profits need to be spent when business is doing well. Owners should also make sure they are saving enough in retirement accounts.
- Succession – About 3 out of 5 business owners do not have a succession plan in place for retirement or death. This is one of the least planned for events of any business.
- Taxes – How and when money is earned and spent can affect income taxes. Working with a tax planner can help business owners use the tax laws advantageously.
- Processes – To keep a business running well, especially when the owner is away, is having written processes to help anyone perform tasks consistently and on time. You might include job descriptions for each employee.
- Strategic Initiatives – Every year, a business owner and the employees should meet to discuss what goals are to be accomplished for the year. Goals that are written down have the best chance of being met. Quarterly meetings, with employees, should be held to monitor and make adjustments in your efforts towards achieving these goals.
A business owner needs to do more than open the door in the morning, serve customers and close the door at night. Business Planning is essential. Working with financial experts who specialize in helping businesses can pay off and prepare a business owner for most economic challenges. The Turnaround Group can help you with Financial Ratio Analysis. See more details about how.