5 Myths About Business Planning

by | Mar 9, 2020 | More business

When people go through a bad patch in business, they sometimes refer to it as ‘a bit of bad luck’. We all get hit with something unforeseen from time to time but most often ‘bad luck’ is a result of bad management or bad decisions.

Here’s a double-barrelled tip:

  1. Complete a business plan – in writing.
  2. When it’s done, don’t put it in the bottom drawer. Keep it on top of your desk and regularly compare your actual performance to your plan to see whether you’re achieving your plans, falling behind or actually exceeding expectations.

Let’s look at 5 myths about business planning:

  1. ‘You need special skills to do a business plan’. You don’t have to be a genius to plan or set your objectives. You are the person who knows the business and knows what can be achieved. Get involved and involve your accountant in the process too. They have the skills to make it simple for you.
  2. ‘Planning takes too much time and costs too much.’ Your time is an investment in your future profits. It’s worth setting aside one or two days to create a business plan for your whole operation for the next 1-2 years. It’s not a cost; it’s an investment in the future of your business. You’ll find that it’s the best money you’ve ever spent on your accountant if you involve them.
  3. ‘With a simple business like mine it’s easy to see what the problems are.’ Simple answer… if you know what the problems are then they shouldn’t be there. Plan to eliminate them.
  4. ‘I keep my business plan in my head.’ It’s too easy to forget an objective if you don’t write it down. You keep fooling yourself that you are achieving what you need to achieve. And, if anything happens to you, your family, partners or key team members need to know the plans and objectives for the business.
  5. ‘In my business, I can’t plan ahead – it’s month to month.’ That’s being reactive, not proactive. If you can plan so things don’t happen to you, life becomes much easier.

In summary, plan ahead, and stay in control. Remember the 6P’s of success… Proper Planning Prevents Pretty Poor Performance!