The art of planning ahead to ensure long-term growth
Forward planning is the key to the long-term success of any business. Despite this, almost two-thirds (61%) of UK SMEs in a recent survey admitted that they fail to forecast sufficiently.
Further figures have shown that 57% of SMEs are only planning for the next 6 - 12 months, despite more than half (55%) admitting that they would rather have plans in place and that they understood the benefits that long-term planning could bring.
Here are just a few tips that can help businesses plan for the future and ensure their continued success:
Define what long-term means
In the fast-paced world of business, companies need to ensure that they are able to keep pace with any changes in the market. As a result, the parameters of a long-term plan may change over time. Where once a long-term plan would have been over five years, in order to ensure that companies are responsive to the market this may need to change to two years.
Utilise appropriate business planning software
In order to streamline the process of long-term business planning your business may want to consider investing in a business planning software application that meets your needs.
This will also help to deliver a professional format for your business planning which may be useful when approaching lenders or potential investors.
Put a cash flow management system into place
When it comes to ensuring the smooth operation of a business, the old adage that “cash is king” has proved itself to be true, and it is crucial that businesses put a cash flow management system in place as part of their long-term planning.
This will help to adjust cash flow in relation to the amount of revenue generated, helping to ensure that the gulf between cash in-flows and out-flows is never too wide.
Set a clear, long-term financial plan
Outlining key financial goals within a long-term plan should help a business move successfully towards growth. This should also include a series of short-term plans that will provide the steps needed to reach a longer term goal.
Outlining profit and loss projections for each period is also central to this process. If your business needs support in the current economic climate, you may want to seek professional advice on corporate recovery options.