I’ve got a confession to make. Up until about five years ago, I didn’t have a business plan.
*Waits for gasps of shock to fade*
I know, it seems crazy to me, too. I had been in business for more than fifteen years. I should have known better, right?
Don’t get me wrong… I had an idea of where I wanted to take my company and I did verbalize that idea to my team. (Okay, to my one full-time employee). The problem was that I didn’t write it down and we didn’t follow that plan. In essence, I was winging it. As a result, when tough times hit in 2008, my business started on a downward spiral that pushed me into scramble mode.
Part of this had to do with the rapid decline in the economy. Within the span of a few months, I went from a business model where I could demand top-dollar for my wedding planning services to one where I had to offer the best possible deal on a wedding package just to scrape by. On top of that, the industry suddenly became saturated with wedding planners, many of them people who lost their jobs in the event planning or hospitality industries and needed some way of earning money.
One of these new competitors was that sole employee I mentioned earlier. I could no longer afford to pay her. It felt as though things had completely bottomed out. Without a plan in place, I wondered how I’d ever get back up again.
Fast-forward five years. From those dark days of wondering how I could afford to pay my own salary, I’ve grown my business into an event management company with three strong brands encompassing weddings, social events and corporate destination management services. Our team totals more than twenty people, and we work on events across the globe, nurturing relationships with hotels and other venues on an unparalleled scale.
If I hadn’t created a business plan and taken the first steps to follow it, I would still be at the bottom of that spiral. A number of the people who experienced similar downfalls in 2008 are still trying to get their feet back under them. Thinking of this, I decided to offer some tips on creating business plans so that other entrepreneurs can hopefully benefit from them. Here are a few:
• Know your company. If you don’t have a clear focus for your company, create one. Write it down. Shout it from the rooftops. And most importantly, don’t ever lose sight of it.
• Know your competition. A market analysis is a part of any sound business plan. If you don’t know your competition, research them. Only by knowing who your competitors are and what they offer can you figure out how to set yourself apart from them.
• Know your clients. Another part of a business plan is outlining your marketing and sales approach. Narrow down your target clients so you can clearly identify marketing avenues and effective sales techniques.
• Know how to think ahead. There were plenty of warning signs that the economy was in a precarious state back in 2006 and 2007, but I didn’t heed them. If I’d had a business plan, I would have. Plan for the worst-case scenario so your company will be prepared if things take a bad turn.
If you had asked me in 2008 where I’d be in five years, my answer would have been pretty grim. Thanks to a written business plan, however, I managed to map the course of my company in a way that helped us achieve success. If you haven’t done so already, do yourself a favor and create a business plan. You’ll enjoy the view from the top much better than from the bottom… trust me on this.