Before the pandemic, business plans weren’t that popular among manufacturing businesses. Maybe we’d all gotten complacent. Maybe we felt like nothing we did would really move the needle.
But things have changed—dramatically!—since the beginning of 2020. A three-year business plan is no longer an optional aspect of machine shop management. If you intend to grow your business and maintain manufacturing efficiency, you need a three-year plan.
Building Your Three-Year Manufacturing Business Plan
“A goal without a plan is just a wish,” wrote Antoine de Saint-Exupéry. As a business owner, you are called to:
- Dream of where you want to go
- Imagine all of your opportunities to expand
- Envision the steps you’ll take to get there and what that change will look like
The end result of this mental exercise is your business plan.
Conferences like the Double Your Value business planning event by EBITDA Growth Systems are designed specifically to help companies like yours develop effective, actionable business plans.
You can also get started by using business plan guides. This one, shared by Forbes, advises owners to craft their business plans in three distinct sections:
- Dream Big: The Three-Year Vision
- Think Small: One-Year Goals
- Act Even Smaller: 90-Day Milestones
Clear steps are more important than ever, with so many of us still reeling from the loss of normalcy brought on by the pandemic. Our routines were disrupted at best, demolished at worst, and resetting our business lives is crucial if we want to not only stay afloat but also thrive.
When developing a strong three-year business plan, Small Business Chronicle’s online publication recommends including elements like these:
Your business’s statement of purpose
A statement of purpose doesn’t need to be complicated or lengthy. You want to clearly define what you offer, why you offer it, and who it’s for.
An analysis of your market
It’s not enough to say, “We make widgets for people who want widgets.” You need to identify your market through and through—and that market has likely changed significantly over the past three years.
Where are your customers located? How do they find you? What is their budget? Their industry? Their application? Who are your competitors? What sets you apart from them?
The more you understand about your target audience, the better your odds of reaching them.
Your marketing and sales strategies
If your shop is lucky enough to have marketing and sales teams in-house, they can help you finesse these strategies. Otherwise, this section should include your plans for hiring or outsourcing.
What types of marketing will you use? What sales approaches will you employ? Do you need a website? A brand? A content team? How can you leverage your current customer base to attract new customers?
A financial overview
Begin by collaborating with your financial team to fully understand your shop’s finances. If dangers are looming, you want to know immediately! Once you’re confident in your company’s financial foundation, outline your goals and projections.
How much will you make this quarter? This year? Next year? What costs do you anticipate—equipment, team members, memberships, certifications? What new revenue streams can you count on?
Your shop’s key players and critical roles
Clarify who your company’s leaders are: their names, roles, and responsibilities. You’ll almost certainly recognize gaps in this lineup, which can help you outline the roles you need to fill (along with a plan for filling them).
Effective Machine Shop Management: Planning with a Purpose
Prepare a version of your three-year plan for distribution throughout your team. Sharing your vision for the future of your shop will instill in your employees a new sense of purpose.
If your business plan is a single pathway, then sharing it is the funnel that brings your entire team together and moving in the same direction.
Let your goals inform your business plan.
Let your dreams drive your purpose.
And let 2023 become your best year ever.