The entrepreneurial spirit is just that, a way of living and doing business. The same energy that brought you where you are today, or where you want to go, is also the nimbleness that will allow the pivoting necessary to help your business thrive. Although things are different today, the essence of small business owners and is all about spirit and adapting to the current times. The great thing is, we can quickly adapt if we have the right tools at hand and surround ourselves with the right people. For a successful pivot, the shift in your business strategy must be accompanied by a financial plan, that you as the leader, thoroughly understand. The budgets, the cash flow, etc. will be the root of your execution and will dictate the pace your business will be able to shift to the new path.
Adapting (or creating) your business plan
Start with your SWOT Analysis: Strengths, Weaknesses, Opportunities, Threats. For a nimble pivot, the two most important are Strengths, which is internal to your business, and then Opportunities which are external. So, think about: What makes you great and different? What are at least 3 strengths you have as a business? Then, consider current opportunities that align with your strengths. For example, do you provide services that can be offered virtually, or delivered to homes? Or maybe presented and marketed in a different manner? For example, a special event company now designing graduation and birthday caravans. Although smaller scale, there is more volume, which brings in the next step.
Budgeting – the financial fundamentals
Here we consider: How is this pivot going to help my sales? And are there different costs involved? Will there be different fixed costs and variable costs? Keep it simple and create your budget sheet in whichever format works for you, while also considering funding sources and forecasting cash flow. When doing so, price your product or service aligning the value with the profit you want to make. The important item here is to think strategically but also to move quickly to take advantage of the opportunity.
Now that you have gone through the initial steps, maybe you want to bounce the idea with trusted people in your network. This can help with perspective and ironing the details before activating, and maybe even get some new leads. We did this with Almotti and helped guide the conversation around their new fixed and variable costs.
Activating your business plan
Almotti has a successful pivoting story with its gluten free Italian delicacies. In fact, when they initially worked on their SWOT, it was an opportunity they had not had time to launch. But now, they have shifted their retail sales to online with 3 simple steps: Implement e-commerce on their website; access to delivery van, while taking advantage of available funding. To test demand for in home delivery while promoting their new services, an aggressive social media campaign was activated, with broader plans in place. Almotti has seen a 300% increase in sales week over week.
Having a solid business plan that can pivot with the times is important for business success. DCC Accounting helps clients navigate to help businesses thrive. Get in touch.