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Profitable Business Planning: How Do You Organise Your Small Business For Profit

Every company needs a sound and robust business model that scales as life changes. Many small businesses start with a business plan based on guesses. Then as life rolls on, there is never time to update it to reflect your evolving situation. When your accountant nags you, you just feel bad. And your bank manager makes a new business plan a condition for any money discussions so you rush into guessing again.

Be succinct and clear

In my experience, a well-written Business Plan will earn you money! For small businesses, it can be two sides of A4 - in fact the briefer the better. Four questions need to honest answers:

• Do you tell a clear story in simple business terms?
• Do you show where extra investment (of money or effort) will lead to increased returns?
• Do you show where unique value is added for your customers?
• Do you explore how you expect to maintain your competitive edge even as your market changes?

Stay flexible and client-centred

You need to consider Scale, Scope and Structure, aligning them with your long term Mission and current Business Plan.

Your mission is simply 'Why are you running the business?' State your clientele, the needs you satisfy with products/ services and your unique approach. A strap line of 15 words is ideal.

Your scale describes your team - whether you employ them, associate with them or do sub-contracting.

Your scope outlines the clients you want to work for and your key products and services.

Your structure defines how you sell to clients, the experience and skills needed for purchasing, production and delivery and how you manage your cash flow. Being small, you are unlikely to have departments but you will have individuals following processes within a team.

Please remember that organising your firm is an exercise in frustration. (Sorry I am not joking!):

• Time and market events overtake even the best organisation - so design in flexibility ready for when you need it.
• Unintended consequences grow with time - so keep watching for the unexpected. Set up triggers to flag possible issues, agree who monitors each flag and make the most interested person responsible for fixes.
• Make/ buy decisions always trade-off costs against co-ordination - so monitor how your suppliers and associates effect ‘internal' costs of quality control, communication and re-work. Be prepared with a ‘plan B' and re-take these decisions at least once a year to keep people on their toes.
• Understand the balance points in your business. But only re-organise once in three years - even small changes take several months to work through a business.

Look for results

If you will accept advice, you should pencil comments on your Business Plan monthly and re-write it yearly. As you keep your business plan focused on the needs of your clients, you will thrive.

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