We are often asked this question by small and larger business alike and our answer is the same no matter whether you are a sole trader or a fast-growing business: continually! Let us explain that in a little more detail to help you put your own business needs into context and help you determine when the right time is to review and update your own business plan.
Ideally you should be keeping your plan in mind at all times: when talking to clients, listening to staff, or meeting with partners, suppliers, and competitors. You want to be mentally checking that you are on track with your goals and targets on a weekly and monthly basis with a more formal, structured review annually. There are also some key milestones and instances when you should review it to make sure it is still in line with expectations. These include:
New financial year
This may be the tax year or your own business’ financial year. This will help you to review your targets and plans to see how you have achieved them, or if not why not. It will also help you to set new targets or revise the old ones to keep your business on track. If your business is in a sector that is in constant flux or is moving quickly then your review may need to be more frequent – on a quarterly or even monthly basis – to keep you ahead of the game.
Big market changes
These can happen at any time and without warning. Think planning for Brexit and how it may affect your business or a sudden economic downturn (or upturn even!) that you need to take into account. Customers’ needs and wants can also change presenting you with new opportunities or requiring a change in products or services to reduce any potential losses for those that suddenly go out of favour.
You need financing
Any lender will want to see an up-to-date business plan with detailed projections and contingency plans before considering any loans or financing options. This will also help you determine exactly how much and what type of financing you need and how you plan to repay it.
A new competitor may have emerged, or an existing one made some significant gains in market share, putting your own share and client base at risk. Keep on top or your competition and prepare for any contingencies giving you time to re-plan where necessary.
New products and services
If you are introducing something new then your business plan should reflect this: how does it affect your financing, supply chain, team, and clients?
If you have had a change in your management structure, or new managers have joined (or old ones left), your business plan should not only reflect this but also take into account any ideas and plans they may bring to the business.
If you would like some advice on business planning or would like to review and update your existing plan talk to our experts at Hammonds Accountants. With a wealth of experience in all sorts of business sectors, we are the right team to help you take your business to the next level. You can get hold of us on 020 8249 6328 or whenever you need us.