The Bridge Plan — How Are We Going To Get There?

When my partners and I bought Ford’s auto recycling subsidiary, it was losing huge buckets of money. As we prepared our financial forecast on the turnaround, the asset-based lender and venture capital firm that were our stakeholders wanted to understand exactly how we were going to increase sales and reduce expenses.

The stakeholders required us to produce a credible plan. For each line in our forecast, when we said we would raise sales or lower expenses, we prepared a bridge plan. There were over 100 lines. How exactly would we achieve the numbers we were forecasting? What resources would be needed to meet the forecast? How would our initiatives affect each month’s numbers going forward? How many months would the initiative take? Our bridge plan spelled out detailed answers to each of these questions.

To make a good bridge plan requires recognizing that some initiatives take longer to execute than others and that some initiatives bleed through the financials more than others. If we were forecasting a 10% increase in parts sales (or cash flow), how would it be achieved? Increased turns? Raising prices? Better close rates? Bringing in more customers for that product or service?

We had to document each tiny step—including the resources needed and the person accountable for planning, executing, and measuring of results. Though simple in principle, making a bridge plan is a daunting task in practice.

Does your plan forecast a 10% increase in sales? Build a bridge with each component of sales you will need to reach the goal. A good bridge plan to achieve a 10% increase has more than one sales component and a total forecasted bridge that delivers at least a 20% increase. Some components won’t hit their goal, so build in some wiggle room.

Bridge plans can be used for almost any initiative, such as expanding marketing, processing more inventory, hiring more people, or achieving greater profits.

Get your whole team bought in by making them a part of creating the bridge plan, knowing they will be held accountable for the results they forecast. If you’re competitive and your team wants to deliver, creating bridge plans gives you an exciting opportunity to lead and inspire.

Knowing how to create bridge plans will make you a better businessperson and increase the odds that you will hit the short- and long-term goals you set for your business.

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.com5940 Eden, Haltom City, TX 76117.