A business plan is NOT a waste of time! The trick is find a way to document your strategy in a way that is meaningful to you and your team.

A study released by Inline Partners in 2020 revealed that in Australia:

60% of businesses will fail in the first three years, and of those who fail 50% are actually profitable

Wow, hey.... those figures are staggering.

So, if half of the businesses that fail were profitable, why are they failing?

Well, the reasons are many. However, one of the largest contributing factors is the failure to establish plans so they know where they are going, why, and where to spend their time, money and energy to be the most effective.

In order to do that, business owners need to have a clear understanding of why they are in business, what they want to achieve, how they are going to achieve it and what the external factors are that will likely influence their success.

Risk Management is not just about health and safety. Risks can come from all aspects of your business including external factors that can influence its sustainability.

Managing those risks means identifying what could happen and planning/implementing ways you can reduce the impact on the business, staff, customers and the community, when or if they occur.

Risks could be related to:

Health, Safety or Environment

Financial

Legislative

Industrial Relations & Staff Management

Building & Property

Professional Indemnity

Business Reputation

Information Technology

Supply Chain

Community & Culture

Business Continuity

This is not just about the money coming in and going out.

It's about how you manage those funds to ensure the ongoing sustainability of your business. Things like budgeting, forward planning, stock management, tax management, records management and being prepared for the unexpected.

Can you look at your books any time and get a clear, current picture of how your business is travelling - OR do you need to wait until the end of the month?

Do you know how much money you owe, to whom and when it is due?

Are you waiting ages for customers/clients to pay your invoices and have trouble predicting what the cash income will be for the next week/month/year?

Do you consult with your Accountant throughout the year to ensure your funds are leveraged to the best advantage? OR do you just see them at the end of the year when the tax return is due?

Are you clear on who your customer/clients are and why they spend money with you?

Have you established a brand that is identifiable and relatable to those customers/clients?

Understanding where, when and how to spend your time and money on marketing activities is super important to ensure you reach the customer that is going to be engaged with your business and ultimately spend their money with you.

Once you have them, it will then be their experience when "doing business" with you that will determine not only whether they will return, but what they will tell the world about your business. Happy and returning customers is a true indication of a business run well and a massive milestone to success.

When you hear the word "Compliance" do your eyes glaze over?This is the response I see with many business owners as the whole Compliance thing seems so overwhelming. However, in all the years I have been working with businesses, failure to comply with reporting and payment requirements of the Australian Taxation Officer (ATO) is the main reason that most of the businesses have found themselves in trouble. By the time they have made it to me, it has been almost too late.

When you are in business it is crucial that you know and understand what you need to comply with and when. Failure to do this often leads to massive consequences to cash flow and immeasurable amounts of stress that could have been avoided with some planning and forethought.

Do you know which legislation and regulations apply to you and how to meet them?

Do you know and comply with the ATO reporting requirements and payment deadlines?

Do you know and understand your obligations in contracts and agreements such as leases for premises, supply agreements, funding agreements, insurance policies etc?

According to Claire Harrison, a very well respected HR specialist based in Australia:

"Depending on the size of your business, the total costs of replacing an employee varies from 30-150% of their salary."

Those figures are amazing and explain why employee retention needs to be the focus of any small business, rather than fostering a culture that accepts high levels of staff turnover as the norm.

To ensure that you are in control of your team culture, have clear and engaging people management policies, and procedures and a strong focus on employee wellbeing.

Provide your team with the opportunity to be involved in decisions, ask them for suggestions and improvement opportunities, and give them the autonomy to work at their best within the parameters outlined within your procedure documents.

Assets are not only a big initial cost to business but without a good management strategy they can be the cause of unexpected interruptions and delays (due to breakdowns) a risk to health, safety and environment, and a significant financial burden when they need to be replaced before they were budgeted for.

Asset Management is not just about the financial definition of asset though. In business it is bigger than that. It is about having a clear understanding of ALL the assets in the business (regardless of size or cost), when their maintenance requirements are, whether they need regular calibration or other quality or compliance measures and when.

Do you have your asset management procedures in place?

Could you easily produce a list in the event of an insurance claim with evidence of purchase and value? Are your assets considered in your business continuity plan in case business is interrupted unexpectedly through fire, flood or other events?

Do you spend more time on reactive maintenance, or proactive maintenance? How many times does an item pop up on a pre-start before it is addressed? Do you know that this is the first place Worksafe and other authorities will look if you have a piece of plant involved in an incident? What do you have in place?

When we have a business that is running well, it can feel so super good that we often don't direct time, energy and resources to investigating how we could be doing it better.Continual improvement can be something as simple as customer surveys, using online reviews or feedback, asking staff, contractors and suppliers what we can be doing better, or tracking the amount and reasons for returns of products.

The trick here is to identify where there are trends and then use this information to make continual improvements to the way you do things within the business.

The TRAP is to write off reviews and feedback as whinging and whining, or buying into the belief that the "troublesome" customer can go elsewhere. There is value in reviewing and investigating all claims within the business to identify things that you can work on or adjustments that can be made.

While many businesses often undertake this review process informally, it is important to have the issues documented and the way you have adjusted things in your business to address concerns as they arise. This will provide you with guidance into the future and assist with planning for sustainability and success.