Almost all entrepreneurs should consider updating the strategies and tactics section of their business plan to meet constantly changing market realities.
Creating your business plan may have been a pain, but updating a plan is easier because you already have a framework. During your business launch, you probably had little experience, and many of your marketing and operational forecasts were just educated guesses. Now that you have some experience and a proven track record, you know what works and what doesn’t.
Recognizing the important events and changes that may require you to update your tactics is an important skill to acquire. Here are some pointers on how to recognize those times.
You are ready to take your business to the next level. Getting funds from a bank or investors requires a more sophisticated plan. Even if you don’t need additional funding, a business plan based on a certain size of business might not be adequate to support a much larger one, which may need additional employees, square footage, etc.
Uncle Sam throws you a curveball, in other words, regulatory changes impact your business. One potential change in many states is the imposition of sales tax on all internet purchases. The result could be a leveling of the playing field that will make online and brick and mortar stores more competitive with each other.
The economy has changed inflation, recession, unemployment rates, all impact your customers’ ability to buy your product or service. This will impact your revenues in a bad way, and depending on your staffing, adjustments may be needed there as well.
Also, consider making a business plan update when you gain a major new customer or lose one. And don’t forget about your suppliers. When a main vendor changed their terms and conditions, it can really throw your small business for a loop. Imagine a vendor changing from giving a grace period to requiring cash in advance.
Whether one of these reasons indicates the need for an update or not, always try to make it a practice to review your business plan at least annually to plot your course for the coming year. But consider this, your competition may be conducting business plan reviews quarterly…or even monthly.