Developing a Business Plan During a Recession

A business plan is more important now that recession fears are around that ever before.

If you are starting a new business now that there is an economic downturn or have a business you are reviewing to look for different customers your business plan becomes a very important document.

Even during economic growth periods every company should have a plan but now your plan becomes the most important document you can put together. This article looks at what you should be doing now.

Just take a couple of hours and open up Excel. You don’t need anything more than this. Make time periods in 12 columns and put down the left hand side your top 4 selling products or services. Underneath each product put down the top 3 customer groups you are selling to and then in each month type in how many you are going to sell and the profit per product or service for each.

Now you have a rough 12 month prediction that’s likely to cover 80% of your business revenues. As the 80/20 rule is critical at times like these (ie: concentrate on business that’s going to get 80% of your profits) you are well on the way to developing a plan.

If you think the revenues and gross profits you have calculated above are enough then start to develop a marketing plan – a plan of how you are going to communicate to your customers. Of course selling to existing customers is easier than new customers so develop those plans first.

At this stage you’ll have a P&L and a marketing plan that covers a very simple business plan. This again is probably 80% of a business plan that you’ll need. As most of your competitors wouldn’t have done any of these things you are further forward that your peers.

You can tidy up by looking at new customer groups or new products that you can market to others. Perhaps also look for market research to detect if there are gaps you can exploit or even markets that are growing at the moment you might want to dip your toe in. Remember we have a range of already completed business plans in our sample business plan database you can download and adapt yourself.

The key is to take action. Any action is better than nothing and a P&L and cash flow spreadsheet are great starters. Please let us know if you have any questions.

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