Pizza on Fire: January-February 2015
By Tom StankiewiczFeatures Business and Operations Finance
Creating a simple business plan
Nothing lasts forever. Every now and then we hear about a business that
has been around for many years and unexpectedly has closed its doors.
Nothing lasts forever. Every now and then we hear about a business that has been around for many years and unexpectedly has closed its doors. The reality is the survival of our businesses is dependent on many outside factors. I often ask myself how we as business owners can prevent the unwanted closure of our businesses. Although many of those factors are out of our hands, we certainly have control over our business’s potential.
|It’s important to set clearly defined goals that can be measured and verified.|
The most common strategy for staying in business seems to be having a good long-term business plan in place. It is one thing to just talk about the future of your business but having a concrete business plan will allow you to measure your success along the way. Think of it as a roadmap that will lead you in the direction you want to take.
A common misconception is that only start-up businesses need a business plan. I would argue that it is essential for all businesses to have it and review it on a regular basis.
If you don’t have time to create a business plan on your own, many businesses out there can do it for you. Or you could search for ideas on the Internet. With many variations to choose from, at times you might find it overwhelming to locate the right information. These days the Internet is flooded with information and advice on business topics. That’s why, if you decide to do it on your own, it is important to invest some time and do in-depth research.
So how do you know if you have a great business plan that will allow your business to grow successfully? First, it must be written in clear language so that it’s easy to follow and execute. A plan that is complex and difficult to understand will not be of any assistance to you. Rather, it will be a document that you will dread to review and over time you will simply put it away. I’m sure that some business owners have learned this the hard way and needed to rewrite their original plan. In this case, less is definitely more.
The number one mistake pointed out by many owners is that they have included items in their plans they could not measure. If you do not have clearly defined goals that can be measured and verified, then your business plan is of no use to you. For example, simply writing that sales need to increase in the next quarter is not good enough. In order to measure this deliverable, a better goal would be that the new pizza special should increase sales by 10 per cent. A specific objective like this will allow you to compare your sales to the last quarter and show if your target was met.
With a clear sales target of a 10 per cent increase, you could analyze it further. If your sales did not increase as expected, then you could review to determine if the new pizza special was the right product. Maybe it was introduced and offered at the wrong time. Maybe its price didn’t appeal to your customer base. Regardless of the outcome, this information could be used to further understand what your customers are looking for. You could supplement this information by asking customers for feedback that you could then incorporate when creating your next pizza special.
The second important point is that the business plan needs to be reviewed regularly. This is not to say you need to go over it every week, but it would make sense to review it at least on a quarterly basis. Reviewing the plan regularly will allow you to implement changes that you otherwise might not have considered. It’s important to remember that this document is not set in stone. Its purpose is to give you direction based on your future vision of the business. This means that it could and should be modified, if necessary.
My advice to all is to think big and think forward. Envision your business five or 10 years from now, not just tomorrow. Thinking that far ahead requires a clear, flexible business plan that will keep you on the right path.
Tom Stankiewicz has been in the pizza business for more than 15 years. He has been the proprietor of Bondi’s Pizza in London, Ont., since 2000 and is president of the Canadian Pizza Team.
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