Chapter 2 of my book, How to Salvage Millions from Your Small Business, discusses making a plan and understanding your customer. It’s funny how we wave our arms in the air (figuratively speaking) and talk about what we are going to do, but never get around to putting the plan on paper. Equally humorous is how later we have selective memory and justify our lack of success by remembering only what we want to recall from that plan.
There is no substitute for putting the entire plan on paper for these reasons:
- With the plan on paper, you can show it to key employees for comments and ultimately use it to get their buy-in.
- You can show the plan to your banker and gain great respect. You may want to “dial it back” for the bank so that you can always exceed the banker’s expectations.
- In the process of putting it on paper, you will find many assumptions you thought you understood but which don’t play out as anticipated.
- Putting it on paper will force you to go back and look at prior periods to “test” your assumptions. You will learn a lot from this exercise.
- You will probably realize, as a result of putting it on paper, that you haven’t been gathering all the operating information and metrics necessary to make fully informed projections.
Setting goals on paper will also allow you to set milestones. In other words, if you are now at $100,000/mo. in sales, and you are predicting that you will be at $135,000/month in 12 months, it’s easy to see that you need to have one or more milestones along the way.
Although you may not have achieved 50% of the forecasted increase in 6 months, it’s reasonable to assume that you will have achieved, say, 40% of the goal. If at that point you haven’t achieved the milestone, you need to figure out how to get back on track. Don’t wait until year-end to adjust.
When I do consulting, I frequently find the lack of operating metrics and no written plan to execute against.
Know your customer. Meet with your staff, and decide who your core customer is. Following that, in every planning meeting, make sure you are matching your product, warranty and service level to that customer. Recyclers, I believe, have tried to be too much for too many for too long. Many of us believe anyone driving a vehicle (regardless of age, whether it’s import or domestic, customer’s location, wholesale or retail purchaser, or type of part needed) is our potential customer. To thrive, and achieve significant success, you simply must decide who your core customer is and act accordingly.
Remember only you can make business great!
Ron Sturgeon, Mr. Mission Possible, has been a successful business owner for more than 35 years. As a small business consultant, he can deliver wisdom and advice gleaned from an enviable business career that started when he opened a VW repair business as a homeless 17-year-old and culminated in the sale of several businesses he built to Fortune 500 companies.
Ron has helped bankers, lawyers, insurance agents, restaurant owners, and body shop owners, as well as countless salvage yard owners to become more successful business people. He is an expert in helping small business owners set the right business strategies, implement pay-for- performance, and find new customers on the web.
As a consultant, Ron shares his expertise in strategic planning, capitalization, compensation, growing market share, and more in his signature plainspoken style, providing field-proven, and high-profit best practices well ahead of the business news curve. Ron is the author of nine books, including How to Salvage More Millions from Your Small Business.
To inquire about consulting or keynote speaking, contact Ron at 817-834-3625, ext. 232, rons@MrMissionPossible.com, 5940 Eden, Haltom City, TX 76117.