This year I celebrated 5 years of being a Business Coach for Women of Color and Allies. Looking back through my journey, I’m able to reflect on what went exactly to plan and where my business took a few surprise turns. As my clients know, I’m a huge proponent of looking back on the past (I’ll share how I do it down below), but if you want to grow your business, reflection is most valuable when paired with the creation of a strategic plan. While writing a business plan may not be the most exciting part of being a business owner, it’s certainly an essential practice to implement every now and then, and essential if you are seeking investors.
Why It’s Important to Have a 5-year Business Plan
Whether you’re a fan of 5 year plans or like to find success by going with the flow, there’s no doubt that there are some serious benefits to outlining your business goals.
- Your plan ensures you are growing sustainably and efficiently
- When you’re feeling stuck in the day to day, you still know what you’re working towards
- Seeing your business goals helps you better understand when to add team members
- Creating a plan helps you to reflect, strategize and analyze
- If you are looking to expand your business, having a 5 year business plan is essential when it comes to showing investors you are serious
Now that you have an understanding of how a 5 year plan benefits your business, here’s what you can do to get started.
Reflect Before You Project
Setting aside time to properly reflect on your business over the past quarter, year, and multiple years, is crucial to understanding what’s working, what’s not, and what business strategies you need to implement or change to move forward.
If you want to hear more about the importance of reflection and how to address what is/isn’t working, you can tune into this episode of my Color Your Dreams Podcast, How to Plan for the Rest of the Year.
When taking time to look at how business has been going, consider this guidance:
- Examine patterns throughout your time in the business, carefully looking at the periods of highs and lows. What do you notice?
- Review your products or services. What are your top two or three? Can they be simplified or improved?
- Before making any financial projections, look at your expenses. Is there anything you are paying for and not using? What can be cut?
- Based on your numbers over the past, where is there room for growth? What can be expanded?
- How did personal life and mental health play a role in your business highs and lows? How can you build in time for self care breaks when you’re not doing well?
Something to consider…
In business, we’re so often talking about expanding, growing, and scaling. But as you are making your 5-year business plan, remember: quick growth isn’t always the best growth. It can become expensive and inefficient very quickly. Before creating lofty goals because you feel pressured to grow at a significant rate, don’t forget to ask yourself, “What is my actual max capacity for new clients/projects/sales this year?”
To avoid business overwhelm and prevent burnout, listen to this Color Your Dreams Podcast episode: Simplify Your Business by Knowing More and Doing Less.
Getting Started With Planning and Projecting For Your Business
Once you’ve finished your reflection and numbers/strategy analysis, you’re ready to look ahead. Be ready to plan for:
- Determining what roles you might need to hire for and how much you’d like to grow a team
- Giving space for personal goals. Do you want to make room to travel or will you need time away from work to start having children?
- How to strike a balance between growth and realistic expectations.
What You Need to Create a 5-Year Plan
- SWOT Analysis – SWOT is a framework based around strengths, weaknesses, opportunities, and threats and is a useful tool for analyzing these four areas of your business. This tool can help you strategize your upcoming business goals.
- Business Metrics
- Sales metrics – look at referrals, renewal rates, income from all sources, and expenses
- Marketing metrics – look at your social platforms, email marketing, Google SEO, and platform analytics
- Industry Analysis
- What makes you different and unique?
- Who are your competitors?
- Detailed Marketing Plan
- Focus on what has been working well and narrowing down your target marketing
- See where there’s potential for growth and what can be reduced
- Executive Summary
- A to-the-point company overview that gives a snapshot of what you offer, why, and to who.
- Team Overview
- List what roles you currently have hired, including a management team, assistants, and specialized roles
- What roles do you plan to hire for and how much will it cost?
- Financial Projections
- Based on past numbers and your growth plan, project what you will likely make each year over the next 5 years
Creating your 5-year plan doesn’t need to happen in an hour, a day, or even a week. Move through your plan section by section, taking your time until you feel comfortable with the projections and analysis. Remember, you don’t have to be rigid in how you implement your plan, it’s a helpful tool to keep you on track and oriented towards a bigger picture goal.
If you would like further support in your career, business, or leadership, my team and I would love to support you in creating a sustainable life! You can schedule a 30-minute legacy business or career review call with me to see if it’s a good fit to work together, and you’ll receive 3 action-items from me.
Looking for more reflecting and projecting guidance? Check out these episodes of the Color Your Dreams Podcast:
- Ep. 5: Time and Energy Management to Get Your Life Back
- Ep 26: Simplify Your Business by Knowing More and Doing Less
- Ep. 29: How to Plan for The Rest of the Year
- Ep. 14: Less is More: How to Simplify Your Business and have the life you want
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