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Annual planning allows you to step back from the day-to-day tasks and look at the big picture. From this perspective, you can set goals, decide on strategies, and focus on where you want your business to go. Understanding why planning is important will help you take the time and energy to create and use your annual business plan.

The eight steps I’m going to share with you address a variety of components necessary to make a powerful, yet practical plan. First, you’ll learn how to develop a plan that ensures your big goals aren’t overshadowed by your day-to-day business responsibilities. Then you’ll consider family obligations, evaluate your systems, and plan for new hires.

You’ll also set aside time for personal and professional growth each year, take steps to ensure your cash flow is in check, and determine how to best market your products and services. Lastly, you’ll discover the importance of remaining open and flexible to opportunities or circumstances that may change your plans.

Most people know the idea of planning is good, but don’t take the time or effort to learn how to plan effectively. 

You can’t reach a business goal you haven’t set. As you utilize the information, you’ll set yourself up to take your business to the next level.

The Power of Good Planning 

If you want to grow your business without constant stress and overwhelm, one of the most important strategies is to develop a plan.

Business planning – when done well – gives you a framework for consistent growth, helps increase your profits year after year, and allows for plenty of down time. 

Step 1: Start with the Big Rocks 

Step 1 is the backbone of your plan. It’s the foundation of your success.

If you’ve seen the productivity hacks video about filling a jar by adding big rocks first, followed by pebbles and then sand, you’ll recognize this first strategy.

Mapping out your year starts by adding all the big, immovable objects first. These are the main events and happenings that will occur in your business over the next year. You want to know what these events are and when you anticipate them occurring.

PRO TIP: The key is to ensure your most important events and happenings take center stage. You don’t want to randomly choose launch dates or retreats without making sure they fit nicely into your calendar. 

Step 2: Consider Your Family Obligations 

Step 2 makes sure family obligations are considered when planning your year. This is important for two key reasons.

First, anything that takes you away from the office will have an impact on your productivity and your revenue. Second, you want to intentionally include plenty of time in your schedule for rest and rejuvenation.

Don’t forget: You can enjoy yearly growth and still take vacations and enjoy plenty of down time. 

PRO TIP: By including family obligations in your annual plan, you can easily schedule business projects where there won’t be a conflict. 

The important part to remember is that family and personal obligations, both yours and important team members, should be considered when planning your business year. Although they don’t directly relate to your business, they can influence your plans.

Step 3: Check Your System Capacity 

In step 3 you’ll take a practical look at your business’ capacity to handle growth.

You can’t effectively scale your business and serve more clients with the same tools you were using when you first started. 

Before you plan for growth over the next year, take a good look at your existing systems to make sure they’re up to the task. If you have a team who handles many of the logistics of your business, ask them their opinions on which systems could be enhanced and improved.

PRO TIP: In addition to evaluating and upgrading your current systems, you may want to consolidate programs to create more continuity and ease.

Step 4: Plan for New Hires 

Step 4 focuses on creating a team to help you achieve your business goals.

As you grow, so will your team. You can’t (and shouldn’t try to) do everything yourself. This is a recipe for disaster and will not support you in achieving your big business dreams and goals.

When you utilize the skills and expertise of others, you free up valuable time for you to create and generate more income in your business.

Remember, it’s always a good idea to hire out responsibilities and tasks that you personally don’t need to do yourself.

PRO TIP: Whether you’ve been growing your team over the last few years or will be hiring your first assistant or contractor, it’s important to plan ahead for new hires. 

By planning ahead, you can make it easier to find recommendations for the job. It also allows you to make clear offers to contractors and other people you may want to have help on the project. Be honest with yourself about what you and your current team can realistically handle. Then plan for the additional hires you’ll need for a smooth execution of your plans.

Step 5: Leave Space for Personal & Professional Growth 

Step 5 highlights the importance of leaving space for personal and professional growth.

Staying holed up in your office all the time is not a good way to grow your business. Your business (and you) will benefit greatly from continual professional and personal development. There is always something new to learn, a skill to sharpen, or a different strategy to try.

When you participate in personal and professional development opportunities, you will meet other people and step away from the day-to-day aspects of your business.

Ironically, this is often where you will make big strides as you see your business from a new perspective.

PRO TIP: Dedicate a portion of your time each year to continuing education, pursuing professional certifications, attending industry events, and other learning opportunities. 

To help you stay organized, keep a running list of courses you’d like to take, events you want to attend, and certifications you’d like to work towards. You can review your list each time you create your annual plan to ensure you include a few items in your schedule.

Step 6: Smooth Out Your Cash Flow 

Step 6 addresses a necessary component of a successful business: positive cash flow.

Cash Flow 101 

Cash flow involves the movement (flow) of money in and out of your business. Cash comes in from customer or clients who buy your products and services. Cash goes out when you make expense payments, pay taxes, etc.

Evaluating your cash flow is important because cash inflow becomes the cash outflow for your expense payments. Keep in mind: cash flow is different from profit. You could be making a profit but have no cash.

Lack of cash flow is one of the biggest reasons small businesses fail. It’s literally “running out of money.”

Positive Cash Flow 

Positive cash flows come from organization and planning.

When you launch a product or offer something for sale, you can expect to have positivecash flow that month.

On the other hand, when you have higher expenses than usual (without any additional cash inflows), you can expect to have negative cash flow that month.

While product launches and sales do increase cash flow, that doesn’t mean you need to have a big launch every month.

Strong cash flow provides the capability for business growth. When you are in the position of excess cash flow, you can operate in a strategic, proactive way, instead of defense and reactive.

Step 7: Plan Your Marketing 

In step 7 you’ll determine how to market your products and services over the next year.

Even the best products won’t sell themselves. This means you have to leave room in your schedule for marketing.

Your personal style will dictate the marketing strategies you choose and the time you devote to marketing.

One thing is important to remember: You shouldn’t overextend yourself and try to participate in every form of marketing. 

PRO TIP: The point is to market in a way that works best for you. 

Marketing Strategies 

There are many ways you can market your business. And new marketing tools and strategies are coming out all the time.

Remember there is no perfect way to market your products and services. The key is to choose the marketing strategies that work best for your personality, business’ bandwidth, and overall desire.

Marketing doesn’t need to be difficult. However, it needs to be done regularly. 

Step 8: Be Flexible 

The last step in this workbook focuses on the importance of being flexible with your business plan.

No plan is written in stone. You shouldn’t be so focused on following your plan to a tee that you miss opportunities or take action that isn’t in your or your business’ best interest.

Business involves a lot of trial and error. The goal of planning is to have a clear path to follow to help you see what move you need to make next.

Yet, business moves fast.

PRO TIP: Your business plan is truly valuable when you can easily alter it to stay relevant in a rapidly changing marketplace. 

And that’s a wrap… 

Following these steps is necessary to create a business plan that honors the work-life balance you envision. And as you remain flexible and open to new opportunities, your plan can evolve and change as needed.