Lessons

Lesson Info

Growth Strategies & Action Plan

What you're going to see first are some slides that actually come from previous sessions, but I want you to see them again because this is how we ended the last session, your goals and objectives, you need to know your goals and objectives, because if you don't know where you're going, you will not get there. I said in the introduction yesterday that research and I will be surprised if anyone confined research that says otherwise that gives them more favorable picture to the fact that one in three businesses does not make it through the first year, and in some arenas, it's way worse restaurants or even worse, one of five doesn't even make it to opening day. So one of three restaurants doesn't one of three businesses small businesses doesn't make it to the first anniversary, and on lee, one of five makes it to the fifth and the absolute wreck of jammed up businesses that don't make it often have to do with they never set goals. They simply traveled in circles without a road map it's, li...

ke when you get in your car to use gps, if you don't know the coordinates that you're putting in, if you don't know where you are and where you want to go, gps is useless it's just taking up space on your dashboard, so but once you know what the coordinates are it gets you most of the time where you want to go now actually, gps is a good analogy sometimes gps isn't up to date sometimes you also have to call somebody in advance and say which exit should we take? Because there are multiple options for one thing you need to know from somebody who knows which is the best o take this highway and then you check that route sometimes you realize you get along there's road construction, you have to work around this's not unlike adapting your business even after you've set its strategies it doesn't mean you're done you still have to keep monitoring, which is why the swat analysis is important once a year in many swat analyses really are rather smart to do every time you even sense that something's afoot. If you have budgeted and you start to see that your budgets aren't coy, you're here actual finances aren't quite where your budgets projected them to be doing many swat analysis see what's on the horizon it's not unlike a gps. Sometimes you have to root around some trouble goals are your over all targets example increase off premise and events sales that was a goal in the brewpub example objectives are measurable results that are necessary for meeting your goals example introduced book pricing, increase retail distribution and launch a mobile pub by july one those air objectives and I don't really want to put people on the spot, but does anyone want to share goals and objectives just to get some feedback? Well, I want to complete my business plan okay, that is when do you know by when you want to do that? Well you actually that leads to a question in that um how if there was an average of a sole proprietorship how long it would take to complete one I don't even have a view you could do your business plan in a weekend in a weekend it's the planning that takes time the planning is what you're doing right now and in your case really not your stumbling block but your the mountain you need to climb is testing your idea for feasibility for everything else it really there is no answer you knew that when you asked the question there is no answer putting the business plan together is really the easy part the hard part is doing the planning on what is your idea? Is it valid that's going that's that's what your that's where you are right now and until you answer that you can't get around to the neck sing, which is how well you monetize that if you don't know what it is, you won't know how you're going to monetize it once you know how you're going to monetize that, then you can set goals how much money then you set strategies, objectives and then strategies of how am I going to accomplish it? What? I would give myself a deadline on this, that idea, because you have a going business, you have a business that's currently making money, and every day that you're thinking about this idea, you're distracting yourself from what? And this is not just her. I'm telling you, there are lots of people who probably are listening to her, not dilemma, her challenge very carefully because they're in the same exact situation, they have a cool idea, and they know it's a cool idea. They don't know if it's feasible and every day that you spend with that uncertainty, you're costing the success of other elements of your business, so you need to set a deadline. I am going to decide on this whether I'm going to go forward with it by this date, and I'm going to do it by the following steps you need to set goals and objectives, even for that idea, feasibility and then you say an on that date if I'm still not sure I'm going to give it a year or whatever and it's going to become part of my long range plans, and I'm going to get back to business because you can't just stay in limbo on an idea and expect the rest of your business. Unless it's something where you have distributors there are businesses I mean listen I'm the lucky one he's just keep going out although I do continuously put out information so people are aware of them but if you have distributor relationships that just keep getting it out you have a little more flexibility to step away and develop a new idea and not worry about harming what's already happening but if you don't have that flexibility, give yourself adele and I appreciate that her goal is to have a business plan and that's her long that's her goal and her objective is test my idea test my idea for feasibility by this date develop a business model for it by this state and plan to have my first sale by this state makes sense because you see it all the time people and if you don't commit to an idea to that extent the next thing knows too you have lots of lots and lots of ideas and they're all like it's keeping you up at night with ideas and every time you open a magazine there's another idea I mean people who are inventive are inventive so thank you the reason I think goals and objectives are so important and if you get fearless marketing you're going to see this slide three times because I am a total fan of this slide it's in every book I've ever done I'm quite sure you need to start with a business purpose because that tells why you're doing what you're doing what makes you get up every day what makes you go toe work? What makes you believe in this mission and it's not about money if it's about money go invest in something I mean it's your investing your energy and a purpose this's the why what is the the what you want to accomplish? Why you're doing it what you want to accomplish in order to be successful at doing it in some ways so that you can keep building on your purpose but what's it going to take to achieve the success you want why you're doing what it's going to take how are you going to achieve these goals? Are your objectives the approach is you're going to follow our your strategies when I talk about that big pile up on the small business success highway I maintained because people are taking wrong off ramps traveling in circles looking for which lane to get in instead of going forward because they never set their direction they never set their strategies on ly after you set your strategies can you outline your tactics and action plan? Small businesses are almost famous for wanting to start here let's run an ad let's run a net let's have an open house we'll wait what objective? What strategy does that support? What objective does that help you reach what gold does it help you achieve? So you have to go in this order first and say, ok, our strategies are to open a brewpub, our tactics are going to be once we've got it, we're going to have pop up events, we're going to do this, we're going to do that, but those become all supportive of these other strategies and tactics, strategies, tactics and action plans follow goals, objectives and strategies. Let me just tell you right now that strategies isn't supposed to be there it's tactics and action plans follow objectives we've really had it's my fault because we had some real issues transferring slides back and forth that things got, but the important thing is you've already worked on your business purpose, you're working on your goals. Next thing is your objectives. This session is strategies if you want to grow your business and almost every business wants to grow. If you don't want to grow there's a section in here on change, adapting, but if you want to grow your business, you only have four choices. Acquire new customers, generate increased purchases by established customers, introduced new offerings and generate increased purchases of established offerings, and this picture puts it even better you can sell existing products to existing customers, you can increase your business in this category. Can we sell more of what we have door existing customers? Maybe you have lots of customers that are buying personal training, but they're not buying all the outer where are they active? Where that you offer something like that, you could sell more of what you have to who you already have, you could introduce new products for those customers retreats probably was an introduction of a new product largely to existing customers. Maybe not. I mean, you can introduce existing products to new customers. This is opening new market areas or starting to serve new demographics very, very old example, but everybody still knows probably of the business, armand hammer and they're baking soda when they people quit making nobody was buying baking soda, so they turned it into a deodorizing product ended up saying, buy a box and put it in your refrigerator and the next thing you know, people started believing that it was so good at cleansing odors in that type thing, they turned it into everything from dieldrin to toothpaste everything else, so that is one where they introduced existing products to new customers. You could introduce new products for new customers, not even for your existing customers, new products that are primarily for new lot of overlap in this but these air basically your four choices for growing your business when you're planning for growth you have to start with planning period goals you have to say what it I don't care what form those goals take it could be revenue it could be profits it's a smart choice that would force you to look not just a selling more but selling more of what makes the most money a number of clients you may simply want five more uh contract clients market share right now you have ten percent market share and I do go into the formulas for calculating your market share in the next session or other measures but it's worth it to say what do I want to achieve part of what's so important about this and we tell businesses this all the time once you determine this if what you really want it's five more club five more personal clients network forget advertising forget everything else I mean understand your goal ends up determining how much effort you have to put into marketing and what channels to use. This is one to one this is not mass media so it ends up allowing you to say no to everything you should say no to because you know what you're trying to accomplish start with planning period goals list three to four key changes that are required to achieve those goals why are those goals not already happening? Why is that growth notary happening might be that the clients you want don't know about you in which case you have to set some awareness goals, it might be that they just I would rather go to somebody that they think is a little more established better brand more trustworthy, which tells you you need some brand enhancement goals it might be that they can't find parting when they get to you, which means you have some location issues, so figure out what are the three to four key changes required that's going to be a very broad range? If this is where everybody's going to have different answers but to get from where you are to this success point, what changes do you need to make what strengths are most important to reaching your goals? So ok, maybe it's parking, but what strengths will help you achieve that? Well, you have the financial flexibility to buy a couple of spaces they can park it or you can't, you know, whatever do you have some strengths that allow you to overcome that? Are there some weaknesses that you're just going to have to overcome in order to make these changes to achieve these goals? This it's back to the swat analysis? Are there threats could affect your growth growth plans? And are there interim milestones you aim to reach? And I really am a fan of inner milestones? Yes, you want five clients, but when you're going to get the first one when are you going to collect the first check? One of you're gonna pay yourself first salary installment if you set some in our milestones all of a sudden it's not just waiting all year for five clients it's that weight would we just looked at our action plan and we did we miss this one? What are we going to do to re plan that and get back on track? Once you know what kind of growth you're going for, you have to assess, do you have the resource is and what do you need to acquire in order to get there and grow? Three sources include capital? Is it going to cost money and do you have it? If you don't have it where you're going to get it management expertise, this is the opening the second restaurant. Do they have the expertise to do that business or employee policies, particularly if you're someone who has a small freelancing business that's growing like mad and you're going to need to hire someone? Are you prepared with the employee policies, even the work for hire agreements? If you're subcontracting that's going to be a resource you need to invest in branding and reputation is that where it needs to be? Strategic alliances and small business is famous for collaboration, strategic alliances, finding ways not to need to buy it and that may be a resource for your growth equipment supplies or materials accounting or information systems are you prepared for the growth that you're a me to accomplish? Are you prepared with the financial record keeping advertising and promotions number one are you prepared to finance that number two? Are you prepared to do it well and will that require some outside resource is business acquisition some businesses need to buy another business to achieve their goals put it on the list of growth resource is you may not never know it but understand that's one way to to grow business certifications of the example that I'm so sorry can't member I think it was greg d said today about the designer who was extremely good but didn't have training okay for him time didn't have the technical expertise to operate in today's environment ok, that would be a growth resource he needs staffer staff training or even certifications to show that his clients that he really is at the next level and investment in r and d new or expanded location other so go through this against your plans and make sure what's it going to take I know the three to four things I want to accomplish what's it going to take to accomplish them because that becomes part of your strategy how you're gonna accomplish that if you don't want to change to grow or if you do but you need to change anyway we are living in turbulent times who would have thought the media environment would look like it looks right now who would have thought that your small business could actually be made more effective than nabisco when it comes although they happen to be very good with their orioles social media but when it comes to reaching customers immediately the playing field has been flattened and with it comes tons of opportunity for you and tons of competition for you so you have to adapt you have to adapt to acquire new customers to generate increased purchases by established customers to introduce new offerings generate increased purchases of established offerings any of these things cause you to have to change even if you're not planning for growth plan for change or plan to be over taken by conditions are nimble competitors and michael karsh our producer helped me find all these road things because I think it's a good analogy getting on the road it's a crowded road drivers of business change what causes changed technology the more that your business is in a realm that either uses technology or the competitors or start certainly use khun technology that is a driver of change market conditions nobody needs to explain that from what we've been through in the changes market conditions effect changing demographics the world's getting older and at the same time who has the money is going in a different direction into degree who has the assets are the older people who have less need to buy and who actually is in a position to spend are the young people so you get some real market condition flux going our demographic flux competition you have to assess in your business how much is that a driver of change economic conditions, changes within your organization all of a sudden a key person quits or a key supplier that you were counting on your favorite designer in an ad agency or your favorite stylist in the photography business quit these air changes that you're going to have to adapt to customer tastes, trends and purchase patterns all of a sudden maybe you notice everybody's coming in with kids your your clientele grew up and they now have children and they're coming in with kids in your retail outlet is not configured the kids are breaking things and parents are yelling at their kids and this is not conducive to being in your business. You need to change product lifestyle cycle and I think that slide comes up again. But remember the lifecycle products get old too and just like all of us have to say who I'm looking a little older, what am I going to do about it? You have to do the same thing for your products and political change your movements the drivers of economic change include new laws, rules, taxes, interest rates, policy jeez, if any of those air affected me that's a driver of economic change, manufacturing and material costs they affect your cost, your availability of supplies, your cost of sales and your pricing if you're seeing even your rent change you hear what all the businesses they're talking about although I often think it's overstated but the cost of providing employees insurance and you see a lot of businesses they're saying that that's going to affect their pricing frankly businesses change prices all the time and don't tell why but anyway economic policy regulatory change that's a driver manufacturing material costs that's a driver environmental disruptions requiring crisis planning by businesses reliant on the climate or affected by environmental change or disruption I think of the toy industry within the last five years I think it was um particularly in boston it came down that toys were being imported with lead in the paint and man it upset well this comes right backto laurels lawrence business but all of a sudden something out of nowhere affects your business so you have to be prepared that's a huge driver of change and political instability or change drivers of customer changed the first one was economic change customer changing, changing business customer in her face if you notice that your customers are approaching your business from different streams um be prepared to adapt or lose they are now screen connected customers are online all the time minimally they want directions to your business and when they call up your site they do not want to get a tiny corner of your great big desktop or laptop screen they want answers that are applicable on their mobile screen and creative life has some wondered full courses on web design top by janine warner among others on how to create a responsive design and a response of design you could test your own very easily you put the cursor in that corner of your website and you pull it down to where it's little does it just keep shrinking or do you keep getting a little corner if you keep getting a corner you do not have a response of design and you need a response of design because when you pull it down and it keeps getting smaller then it'll show up on any screen anywhere whether it's a full wall screen or whether it's a tiny mobile screen and that's what you want because your customers or mobile most of them are now accessing your business on the go and so that's a driver of customer change changing attitudes and expectations they trust friends and france social media friends and rudy is more than they trust you when they trust what you say they trust what others say about you and that gets back to what I said yesterday increasingly your brand is what google or what those online say it is that's who people are listening to that's a driver of customer change you need to adapt to changing tastes and trance fads come and go but tastes and translate toe lasting change and in your swat analysis every year you look what's happening differently what's happening differently that we need to adapt to and your goal is to keep your business so in front of your customers needs that every day they love you more and it sounds crazy to use the word love but that's what it is jean bliss is a customer um experience professional she's written about book I love you more than my dog and she participates in my book on a she gives a checklist and some online tools even for testing your own customer experience she uses the word love customers have to love your business to stick with it because there are love you end your business because there are too many options for them too easy for them to leave ask an answer is it likely to change how do customers find and reach you is it likely to change how do they evaluate before buying is it likely to change checking review sites was not part of the answer five years ago and my ryan maybe it maybe that's it a little I think five years ago it wasn't like it is now um what are they buying and how do they purchase? Is it likely to change how do they rate your offerings and service? Actually we could just say do they rate because that's important too so how do they rate and are they rating in your favor? What do they say about you and to whom this is one of the most valuable questions you can learn you can learn ask your employees to ask people because if people are nice if they're talking to you they'll say really nice things and they might say something frank or to someone else with three words do you use when you talk about our business might be the word expensive and you know what don't let that scare you with the ad agency expensive was a good thing because we got the kind of clients that we needed versus the kind of kinds we were configured to serve versus clients who we're looking for really really low budget offerings what do they want? What need or want to they count on you for in a good question to ask here if we closed where would you go to get this service that begins to let you know what distinctive need if we close what would you most miss home delivery is what I would most miss they are going in the portland newspaper just quit not I still like the newspaper quit delivering seven days a week I miss that so I mean find out what would they miss if you quit doing it and you begin to learn what they value and what do they think is your biggest advantage and you're bigger it's weakness and again here this is where a mentor a close, confident who's willing to be frank with you can help and it's why I sometimes am frank like with that wonderful positioning line that we heard earlier from the changing turning cloth into new items I'm willing to say be frank and say cool physician line not a cool tagline shrink it, somebody needs to tell you those things always turned to somebody who's willing to be frank and doesn't mean you always have to take the advice if you totally think it's wrong that something different, but here it here because often there's a grain of truth um what do they wish was different about your business? And you know, this is funny you'll hear people say if they say they talk about how things used to be with you sometimes that's a really nice indicator of what's missing now or if they talk about another business that just did something really cool for them sometimes that's a hint of what they're wishing for from you often when people trail off when they say, oh, I wish she did home delivery, but I know it's a and they kind of quit saying keep going because often with they are going to say next is what they're hesitant to say, teo, you probe it always probe when they trail off when they don't finish the statement friendly pro bit because that's sometimes where the truth is that can help you adapt in the way you need to when you do see some needs that you need to adapt to changes you need to make start by assessing the situation. Where are we right now? How important could this change be to us? That type thing forecast the change by asking what if what if this happened? What would we do? What if so and so quit great thing to do if you have a business reliant on one huge client, what if that client left? How fast could we ramp up the other? Could we replace that client? Sometimes it causes you to realize you have to grow your business in order to make it less reliant on a client who could endanger your business by walking. And yet, who is there's? No way you're going to walk from. So ask what if for every situation that arised that came out of the previous line of questions test your assumptions, is that really gonna happen? And this is we're getting research on the industry, asking others, even asking competitors this happened to you once we had a key personally, the agency and we overcame that it worked out, but it was bumpy it was very bumpy when the person left and then not too much later, maybe a year and a half later one of the other ad agencies in our region I had the same thing happened and she called actually I called her and said you will survive I left her phone message you will survive and she called me banks, he said, walk me through it, walk me through it and you know what? It's ok to do that with someone to call someone else and say you survived it? Can you walk me through it? What was the worst thing you did? What was the best thing you did? People love to be asked, so use your small business advantage reach out as a person to another person once you've tested your assumptions bracket your expectations for change if we can change this, could we change it fifty percent? Could we change it one hundred percent? Could we? We always used to do that with budgets we always did bracketed budgets. Our goal is to make twenty percent this year twenty percent more this year, so we're going to aim for this revenue worst thing could happen, we only make ninety percent b this much and then mid range is this much? So we're going toe budget around mid range hope for this at key points, we would agree and over in order to meet the mid range we're going to add these things were going toe add some square footage, we're going to do whatever and then we would have midpoint reviews. How are we against that goal before we make that higher? So, brackett your expectations so that you know what point you're going to see? How are we doing against that goal before we make the investments that supported that goal? Have a plan b have a plan b and a plan z and this is I wish I could remember who I read this plan z from and whoever that person is and I think it was a male so him, I appreciate this very much his thing was plan a is we're going to make twenty percent more plan b is if we only make ninety percent if we only make ninety percent of last year plan z is if everything goes wrong, how are we going to be ok? It's worth it to know that even if it's that if everything goes wrong, we'll move it back into the second bedroom and, well, you know, whatever, how the plans they just know it's funny how much that lightens you up to say, we're ok, we can go for this because if everything went wrong not everything, but if all our projections air off, we're still ok because we still have these clients. We still have this revenue stream, so have a plan a plan b plan z commit to ongoing scans for changes. This is where I say this is your milestones. The milestones are very important because at each milestone, if you don't give your business a green light at this milestone, you know what your next step is? You're going to put it into a longer range plan, you're going to adapt it differently, whatever, but if you have milestones you can scan for, you can scan against what you thought was going to happen. You can also look for more changes that are underway, and then you track your plans. I was thinking, as you're saying that I've known so many small business owners who don't even have a plan b, let alone a plan z, they've got their plan a and they think it's going to work and they charge ahead. But the plan z sense absolute and actually planned way in most small businesses over forecasts, revenue and under forecast costs. So we always, always, even when I wasn't a good business planner, we always went through and I was the one because I'm it's money just comes natural to me I mean, many management always I went through and cut everybody's financial. You know, all the account executives would turn in what they thought their clients were going to do, and I always cut the masa great that's your goal, this's what we're budgeting for and then I always increased the expenses and it was worth while it's worth it to over project your expenses under project your revenue. And even then, then you that you then you end up with your budget, your forecasted budget, and even then your plan b is if you do less plan z is yeah, there's so many areas of the business, but I think plan b often applies as well. I knew somebody who actually worked for a long time in the h are recruiting business. Then she went into a completely different field there's a very small business, but she brought those principles ofthe recruiting as her plan b because she was continually interview people because staff leave all the time is so smart and somebody quits, and suddenly you're spending the next two months hiring somebody else that she always had that sort of in the back pocket. One thing I just want to ask very quickly of this person's called nonprofit beers I mean, you talk about this later, this isn't the right time, but would you recommend all of these principles? Also for a non profit businesses, thie on ly thing that needs to change is how you structure the business so that it could be tax deductible. The language you use instead of customers, you have either donors or recipients and how you handle your accounting. Because if you accept accepting donations, you have to meet requirements for what amount goes to administration. And what amount goes to service. So and in business plan, skip for dummies. There is a chapter on planning for a nonprofit, but basically, nonprofits need to be run his businesses.