Why the end of the year is the perfect time to re-examine your business plan
It’s no secret that the past few years have been challenging (if not catastrophic) for those involved in the construction and design industries. This time of year, it’s likely that business owners find themselves with too little work and too much time on their hands to be feeling very productive in their businesses. However, rather than sit around worrying or complaining about the economy, why not use this downtime to prepare for the eventual turnaround?
When construction was going strong, many small businesses were too busy running their business and fending off daily emergencies to focus on creating and maintaining a strong infrastructure. Now that things are slower, it’s a great time to re-think and re-engineer your business. Here are three areas to start with:
Revisit your critical success factors
What do you absolutely have to do to be successful in your business? Take some time to write these things down and then follow up with written goals and strategies and then specific action plans for how to achieve success. Think outside the box and consider outsourcing some business functions to compensate for any current staffing or competency deficiencies. Focus on what you and your team do best and figure out how you can capitalize on that. If you discover areas of weakness or insufficient experience, plan to learn a new software program or participate in industry update classes – anything that will prepare you to hit the ground running when the economy perks up and you find yourself busy again.
Develop a new and improved business plan
Today’s economy is much different than when many construction-related businesses began. Put your hard-earned experience to good use and develop a better plan of action going forward. Don’t forget to include contingency plans for every aspect of your business, including financial projections, marketing plans, personnel plans, capital acquisition plans, operational plans and succession plans. It’s helpful to plan for various scenarios, such as worst-case, most-likely and best-case scenarios. If this sort of planning is outside of your expertise, consider taking advantage of various free resources available to small business owners (i.e. not-for-profit organizations such as S.C.O.R.E. or WSU’s SBDC) or invest in some professional support from your accountant or other trusted business advisors.
Systemize your Business
A system is nothing but a series of processes. These processes consist of activities that are required in order to achieve a result. Based on your critical success factors and your business goals, take the time to write down your processes and systems, including who does what and when it needs to be done, for every aspect of your business. Whether it’s doing the bookkeeping, preparing a bid or hiring and training employees, make sure that all systems have written procedures and backup plans for day-to-day operations, technical failures and unexpected crises. These procedures can be gathered into a procedure manual for each aspect of your business, which also makes bringing on new people much easier as your business grows or evolves. Documenting how you do business safeguards your business in emergencies, alleviates confusion on the part of your team members and can ultimately protect you in potential legal matters. Finally, consider how much more appealing your business would be to potential investors, lenders or buyers if you were able to present a “this is how we do it here” manual.
By taking advantage of this downtime to sharpen your business development skills, not only will you be poised to leap ahead of your competitors at the first sign of economic recovery, but you’ll also find that you’ve become a much more savvy business person with tools and resources that will make you and your business much more profitable.
Jan Stockton is the founder of Stockton & Associates P.C., a CPA firm located in downtown Vancouver. She can be reached at 360-695-6511.