How to Create a Long-Term Small Business Plan

If you’re starting a small business, you need a solid plan. Nearly 50% of new businesses fail, and experts agree bad business plans are one of the main reasons why. A long-term business plan is a blueprint for success. It identifies specific goals and delineates actionable ways to achieve them. It can also be used to pitch your business to private investors and secure funding.

Writing a business plan involves several key components, which should all work in harmony to ensure your business stays focused, yet adaptable. From identifying goals and risks to creating a financial plan, here’s our step-by-step guide.

1. Develop a Mission and Vision

Building a business that stands the test of time requires a clear understanding of your purpose and motivations. Thoughtful mission and vision statements set the stage for your future endeavors and establish a core identity for your business:

• Vision statement: Describe the long-term objectives of your business.
• Mission statement: Define the purpose and core values of your business.

Essentially, a vision statement identifies your goals and aspirations, and a mission statement outlines how you plan to achieve them. Sit down with company leadership to discuss your hopes, goals, and dreams for the future. What do you want your core message to be? What do you hope to accomplish in the next ten years? How can your business make a meaningful impact?

2. Perform a SWOT Analysis

A SWOT (strengths, weaknesses, opportunities, and threats) analysis is a straightforward tool to help you in the early stages of planning, giving you a framework to identify four key aspects of your business:

• Strengths: What’s your competitive advantage? What skills, benefits, and competencies does your business bring to the table?
• Weaknesses: What’s currently preventing your small business from reaching its full potential? How can these weaknesses be addressed?
• Opportunities: What external factors can be utilized to improve your operations and expand your reach? Examples include new software opportunities, investment potential, or rising demand from customers.
• Threats: What external factors might present obstacles for your business? These may include competition in your industry, laws and regulations, or economic downturns.

3. Develop Short-Term, Achievable Goals

Once you’ve identified your long-term vision and analyzed the business landscape, it’s time to set specific goals. Short-term goals should focus on the things you want to achieve in the next two to three years.

Try to ensure your goals are “S.M.A.R.T.” (specific, measurable, actionable, reasonable, and timely). Examples of S.M.A.R.T. goals could include “increase unit sales by three percent within 12 months” or “recruit two new account managers by the close of the second quarter.”

4. Outline Strategies

Each goal you set for yourself should be accompanied by a specific strategy to achieve it. For example, if your objective is to hire two new account managers by the end of the second quarter, strategy items might include:

• Meet with leadership to determine salary budgets and job requirements.
• Create job listings and share them on job boards and social media.
• Review applications.
• Conduct phone and in-person interviews with prospective hires.
• Meet with leadership to review applicants.
• Conduct background and reference checks.
• Offer jobs to candidates.

5. Create a Financial Plan

Many new business owners find that financial planning is the most challenging part of creating a business plan. But it’s also among the most important. A financial plan delineates a business’s current finances as well as goals and projections.

A strong financial plan should: 

• Be useful for business owners and investors alike
• Include three essential financial statements: an income statement, a balance sheet, and a cash flow statement
• Offer realistic projections and include strategies for progress tracking
• Address risks and contingencies
• Outline a strategic approach for long-term financial success

In many cases, it’s beneficial to seek the help of a CERTIFIED FINANCIAL PLANNER™️ professional to develop your strategy and ensure you achieve your objectives.

6. Develop a Marketing Approach  

Marketing is key to any small, consumer-focused business. But not all marketing strategies are created equal, and your approach should be tailored to your business’s unique needs and goals.

Here are some basic steps to creating an overall marketing approach: 

1. Determine your target market. Do your services appeal to a general or niche population?
2. Conduct thorough data analysis to identify customer needs, demographics, and behaviors.
3. Identify ideal marketing vehicles; social media, direct email initiatives, local TV spots, billboards and fliers, print ads, etc.
4. Establish a marketing budget.
5. Develop implementation strategies.

7. Prepare for Risks and Roadblocks

No business is immune to pitfalls and setbacks. From economic downturns, to internal dysfunction, to regulatory issues, you need to ensure you have a reliable structure in place to prevent and address problems down the road.

Here are some potential risk preparations for small businesses:

• Human resources to address internal disputes
• Software to organize and protect company data
• Insurance for financial loss due to a natural disaster or property crime
• A business continuity plan to address issues and remain calm in a crisis
• Investment in team relationships and trust

8. Review and Modify the Plan Regularly

Even the most comprehensive business plan will need to be evaluated and fine-tuned on a regular basis. After all, adaptability is an essential element of any business approach. 

Consider scheduling quarterly or semi-annual business plan reviews to stay up to date with changing markets, pinpoint unforeseen weaknesses, and ensure things are running smoothly. This will give you the opportunity to make adjustments to your business plan as needed and ensure your small business continues to thrive for years to come. 

Build Your Business and Secure Its Financial Future

Finances are an essential part of developing any effective business plan. Financial planning for your business needs to be a key consideration at every level and stage of your small business.

Chatterton & Associates offers comprehensive business services including tax planning, financial planning, bookkeeping, and profitability and efficiency coaching. Our CERTIFIED FINANCIAL PLANNER™️ professionals can help you develop a successful financial plan for your small business.

Sincerely,

The Team at Chatterton & Associates