A business growth plan provides a timeline for next few years on how you’re going to increase revenue. It’s an outline for where you see your company in the next year or two. Growth planning is similar to business planning, however it tends to be more focused on near term profit generation and the actions you will need to take to achieve this. My guide to planning an unstoppable growth strategy covers the key elements to focus on when developing your business growth plan.
If you don’t know where you’re going you’ll probably end up somewhere else. (Laurence J Peter)
This saying has never been more applicable than when it comes to running a business. If you don’t set clear goals along with a roadmap of how you’re going to get there, you’re unlikely to grow your company.
A growth plan should include the current state of your business, and your opportunities for expansion. It should also include an action plan and schedule to help you achieve your vision.
Not only is a growth plan essential for management but it’s important that investors can see how you plan to scale and build sales over the coming months and years. There’s no ‘one template fits all’ available for your individual growth plan however there are some general steps that can help you write one.
How to write an effective business growth plan
Creating an effective business growth plan takes time but the effort will pay off substantially over the long run.
A growth plan should include
- A description of expansion opportunities.
- An explanation of how you plan to fund your growth.
- A detailed description of your growth goals.
- A breakdown of your company’s employee requirements and responsibilities.
- An exit plan.
1. Detail your growth opportunities
Examine the ways you can expand whether that’s to create new products, add more services or target a new market.
But don’t make assumptions without backing them up. If you don’t thoroughly vet the competition or move into new areas without significant market research you could end up in serious trouble. Before you jump in, determine that there is a clear market need for your new products and services. A huge 42% of failed startups cited lack of market need as the chief reason for their failure.
2. Determine how you’re going to fund your growth
Include detailed information on how you plan to fund your expansion and whether you need to seek investment or a bank loan. Whichever route you choose it’s important to have a good business pitch at the ready. The more you can communicate your value to potential stakeholders the more likely you are to get investment.
3. Describe your growth goals in detail
Your growth goals need to be achievable and realisable and based on sound industry research.
Your growth plan needs to include your marketing aims and objectives in terms of, for example, how many new customers you want to gain. Take steps to quantify your goals in concrete metrics and timelines. Don’t be vague. Talk about wanting “to increase sales by 20% every quarter for the next two years” rather than simply wanting to ‘increase sales.”
You’ll also need to include financial information in your growth plan, including profit and loss forecasts, cashflow predictions, sales forecasts and audited accounts. You should assess each quarter of the year, with regular reviews, to see which of your goals were achieved and which weren’t. And revise the plan to reflect the current state of the market.
4. Evaluate your team
Your business growth plan should include an assessment of your employees and an examination of how you’re going to staff your future growth. By assessing your own skills and those of your employees you will be able to see how much growth you can achieve with your current team. Plus, you’ll know when it’s time to start hiring more people with the relevant skill sets.
5. Have an exit strategy
If you are an owner-managed business you should include an exit plan that details the timing of your departure, whether another member of the family will take over, or whether you’re planning to float or close down the business.
Before you attempt to expand your business take the time to create a business growth plan and document your progress as you go. With a well thought out plan in place your business growth will be led by informed decision making, not knee jerk reactions. To help you get started writing your growth plan, it could help to study successful companies’ growth plans to see how they approached theirs.
If you’re still not sure where to start when writing a business growth plan, get help. Seek the advice of a professional growth consultant – and try to find an agency that’s worked alongside similar businesses to yours. They could be invaluable in helping you prioritise your resources and make corrective actions if, for example, you’re currently experiencing low sales or loss of customers.