Business owners are known to dread creating a formal coffee business plan, and many especially avoid revisiting an old one. But a truly valuable business plan is a living document. By keeping it up to date, you are forced to step back from the chaos and make sure the big picture still makes sense. And if it doesn’t, you can take corrective action instead of burying your head in the sand.
It’s nearly impossible for a business plan to remain 100 % relevant to a business that has grown and evolved over the years. In fact, it can become outdated in months. When your plan is current and in writing, it will help clarify your business direction and ensure that key staff members understand your true priorities, and that they’re working from the same set of ideas.
An up-to-date business plan reminds you of your goals around marketing, strategy and operations—all in one place so you can see how they’re connected. Has your market materialized, and at the level you projected? Is your value proposition ringing true with the public? Have you correctly anticipated competitors? A fresh look at your plan will help you revisit any issues and decide whether or not you're on track.
Your business plan should include these forecasts:
- Industry Analysis
- Marketing Plan
- Operations Plan (staff numbers, expenses)
- Financial analysis and sales growth
What if you’re not meeting the goals of your business plan?
When you revisit the above forecasts, you’ll find out if you’re deviating from your original expectations. If so, you can act now, rather than being surprised by a cash crunch. If January sales are 10 percent less than projected, you can reevaluate February and March and immediately decide whether you'll be able to get back on plan or whether you need to start cutting expenses, trying new marketing tactics, revamping your menu (maybe even prices), or exploring ways to make your cash last.
Revisiting a plan is what gives you this advance warning. You'll never know that the world is unfolding differently without a plan to help you measure reality.
But know that your business objectives can change as well, when necessary. New opportunities, new problems, new people (staff or customers) are all good reasons to revisit your business plan—not just rapidly rising or declining sales.
If business is good, should you adjust your business plan for more rapid growth? The most important clues that you should revisit and revise your business plan:
1. Are you considering expanding your operation or services?
When business is good, it can be tempting to find new paths for it. But be sure to give the risk factors—such as market needs and operational costs—a lot of thought. Crunch the numbers and assess whether expansion is truly a viable option, and how long it will take you to recoup your investment.
2. Are you thinking about buying a business?
An acquisition can be a great way to grow your business, but you’ll need to carefully quantify the return on investment. Purchasing can obviously be risky, as sellers may be going under as they try to sell, or inflating the value of their business. It’s crucial to do a full audit of your potential purchase, and to have solid projections for how it will help grow your business.
3. Are you shifting the focus of your business?
You might be toying with the idea of expanding your hours and menu offerings, or tempted to start doing some catering. If you take such a leap, your target market will inevitably adjust as well. Being able to accurately identify your target market will help you develop a successful marketing strategy. Describing your target market in your business plan can help you recognize prospective customers accurately.
Measuring Success. A business plan is supposed to help you reach professional and financial success. Your plan can be used as a motivational tool to help you identify accomplishments. When success is achieved, your business plan should be revised to inspire you to reach additional goals that you may have never thought possible.
It can be helpful to schedule a specific date each quarter, or at least once or twice each year, to review your business plan. No matter how often you examine your business plan, the process will inspire you to focus on changes that will help you succeed. Keep the plan current, and you'll get the most from it by turning it into a document that helps run—rather than simply sell—your business.
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