Why a 5-Year Plan for is Essential for Creating the Growing, Profitable, Smooth-Running Contracting Business You Really Want.

June 24, 2015
Category: Be a Highly Effective Owner,Business Tips,Define Your Vision and Plan

Did you ever wish that you had a crystal ball? With a crystal ball, you could see into the future and sidestep problems and take advantage of opportunities that are coming down the road. Wouldn’t that be great? With a crystal ball, you could have bought that Apple stock back in 1980 or have avoided that big mistake that you’ve always regretted! Imagine the possibilities!

I know, you’re probably thinking, “That’s a fun idea, Bill, but crystal balls don’t exist.” Ok, ok, maybe crystal balls aren’t real, but I have the next best thing for you and your business: The 5-year plan.

One of the key reasons why the painting businesses I talk to and work with have problems as they grow is that they manage their businesses day to day without looking forward to anticipate and prepare for the new challenges ahead. If you don’t think about the future, you may not have enough people, marketing, equipment or the right organizational structures in place to support your growth, and this can costs you hundreds of thousands in sales and profit, as well as a huge amount of stress and frustration and maybe even worse!

So I want to help you create your own crystal ball to help you anticipate and plan for the future, so that you can create the growing, profitable, smooth-running business that you want. Creating a 5-year plan is one of the first things that I do when I start working with a new client. Don’t let the concept of a 5-year plan scare you. It isn’t that hard to create. Here are four simple steps to get you started:

Step 1: Envision the business and life you really want

The first thing you need to do is envision business and life that you really want 5 years from not. Not the one you think that you can have or the one that others tell you that you should have, but the one you really want.

• How big do you want it to be?
• How much profit will you make?
• What is your ideal job description in your business?
• What do you want to be known for?

Be bold and dream a little. Most people don’t. Make it a stretch and something that you’re excited about. Write it down. Great!

Visualizing what you want is a big step. The more clearly you can picture it the more you will be able to map out the steps you need to take to make it happen.

Step 2: Map out your annual growth goals for the next 5 years

Next, break your 5-year goals down by year so that you have a clear path to follow to get you to where you want to go. For example, one of my painting clients mapped out his growth to 2019. He projected 20% annual growth which meant that his $1 million business was going to grow $2.5 million by the end of 2019.

A lot of your projections are going to feel like guesswork and, to a certain extent, they are! But do them anyway! Try different scenarios until you find one that you’re comfortable with. One of the major benefits in this planning process is in Step 3 and you need your yearly projections to for it.

Step 3: Think through the implications of your growth for different parts of your business

With your yearly 5-year projections, you can start to think through the implications of your growth for other parts of the business.

• How many people will you need? How many crews? How will you hire that many people? What will you need to do to develop that many crew leads?
• How will your org chart change over the five years? What will it look like by 2019? How will your role change over time? What new management staff and support staff will you need to support your growth?
• What will your equipment and vehicle needs be as you grow?
• Will your offices and shop be sufficient?
• How many customers you will need to reach your goals?
• What marketing and sales processes will you need to have in place to generate the leads to support your growth?

Answering these questions can help you anticipate and sidestep problems to keep your business consistently growing. It’s just like having a crystal ball for your business!

What my clients love about this process, is that a clearer and clearer picture begins to develop of what they’ll need to do to create their ideal business.

Step 4: Turn your projections into an annual plan

The last step in anticipating the future is to use your projections for the next year to create your annual plan.

• First, break your goals down by month so that you have a clear path to follow to get you to where you want to go.
• Next, think through the obstacles, challenges and other priorities you will need to take on to achieve your goals.
• Build action plans for what you need to do

Now write it all down, ideally on one page. Your plan is no good unless you follow it. You know that! So it is critical that you schedule time in your calendar to implement your plan and check in periodically to ensure that you are on track.

There is huge power in looking forward with your 5-year plan crystal ball!

While having a real crystal ball would surely help you become rich and happy, having a good 5-year plan is the next best thing for helping you create the growing, profitable, smooth-running business you really want. With your 5-year plan, you’ll be able to see what you need to do each year to keep your business growing, and by knowing this you’ll be able to prepare in advance and avoid countless problems!

So gaze into the future and prepare your business for great success! You’ll be glad you did!

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