FRANCHISEFOCUS
Planning ahead Hitachi Capital Franchise Finance on how
to be SMART about achieving your business goals L
ike many prospective business owners, you're currently examining your goals and ambitions. But how
could you turn those dreams into reality? We’d suggest your process be methodical and thoroughly planned, with an honest review of the financial viability.
Failing to plan is planning to fail Some people set up their businesses without a proper business plan. However, many of these fail within the first few years. Don’t allow your failure to plan get in the way of your business ambitions. So, what should you do?
Set your SMART objectives First of all, you need to set your SMART business objectives: Ÿ Specific: Ensure your objectives are focused on what you intend upon achieving
Ÿ Measurable: See how well you are doing and make management decisions that will get you back on course if necessary
Ÿ Achievable and Realistic: By all means, show ambition. However, explore all angles and make sure it will actually be achievable.
Ÿ Time-based: Set a focused time limit to work towards.
Understand your market and competition Next, you need to understand your market (both local and national) and your competition within that marketplace. Depending on your product or
service, you may have identified a few key customers already – but you should know who your competitors are: Ÿ Who else is offering the same or similar solutions to your prospective customers?
Ÿ How are they doing that, and what are your competitive advantages over those businesses? While it’s tempting to believe you
have a unique solution to a problem, it’s 20
unlikely. A competitor matrix, highlighting your USPs and how your proposition differentiates itself from other businesses could be a great way to review your business model.
Operating strategy and marketing plan Your operating strategy is how your business works – the logistics behind your product or service, ultimately determining where you position yourself in the market. This is to be considered alongside
the marketing plan. The best possible marketing strategies are those that test and learn as a target market responds and the proposition evolves. You should have a clear idea of your market and your pricing strategies, but you need to constantly monitor and adapt these as you gain market feedback.
Assessing your resources Make an assessment of the physical and human resources required, such as any property, equipment, machinery and the team you will need. Are your current team qualified to do the job, or will they need extra training? Or will you need to hire additional team members?
Financial projections, cashflow forecasts All of the above needs to be costed into the financial part of your plan. A monthly profit-and-loss projection will provide you with the means to track your progress, while a monthly cashflow forecast will allow you to assess the likely cash in the bank at a given time, closely reviewing this data can significantly reduce the risk of running out of cash. Finally, the projected end-of-year balance sheet will show the strength of your business and its degree of solvency at that moment in time. All three in conjunction provide a full ‘projected picture’ of the financial viability of the given business. Good luck we hope the above
guidance helps you on the way to achieving your goals!
HITACHI CAPITAL FRANCHISE FINANCE Financial services 01844 355 575
hitachicapital.co.uk/franchise-finance fundingteam@franchisefinance.co.uk
Please note that this article is provided for information purposes only and not as advice or recommendations. Before deciding to undertake any course of action you may wish to seek independent professional advice.
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