City2Surf Business Plan

August - another City2Surf and I did a fairly good job, even if I do say so myself. But….if the buses ran better at either end, if there wasn’t so much congestion at bag collection, if etc etc….I’m sure I would have done better and enjoyed the day more.
August…..another financial year over and annual results are in – a fairly good year but it could have been better….if the banks weren’t so stringent with their credit policies, if my marketing had been more effective, if etc, etc….

Running a business, or a race, involves many components working together effectively. Obviously hard work (or fitness), motivation and focus are fundamental, but in order to take advantage of opportunities or avoid obstacles along the way, we must anticipate these as much as possible in our business or race day plan.

This was my eighth City2Surf so you’d think I should have learnt something from previous years like to allow plenty of time for public transport, to come back later to collect my bag (or don’t have one to collect). I make excuses to myself that things are different this year and previous lessons are out the window – there are more people in the race this year (80,000!!), more people to move and bags to sort. However things aren’t really that much different, I just forgot what previously happened as I was wrapped up in the euphoria of the day. Maybe this time I’ll record it while I remember and let it form part of my race day plan for next year!

Was this my first year in business? As it happens it was, but the above lessons still apply. Ok, I didn’t have a previous year to learn from but there are many ways of learning other than trial and error – advice from friends, colleagues, experts or peers at business or social occasions, on-line forums etc. Of all the advice and suggestions I received, how much did I take on board or did I think I knew better what applied to my business. Well of course I didn’t know everything and yes, there are many things I could or should have done differently. Will they now be recorded to form part of my business plan for the new financial year – I’d like to think so.

I’m happy with my race time too – although I hadn’t given myself any targets (eg split and end times) apart from finishing. My training regime had not been as good as it should have been (less haphazard and more structured would have helped). If my time had been just one minute better I would have been ecstatic as it would have moved me up a category – how much extra effort or planning would have been required to achieve that? Perhaps not very much.
The first year of my business was solid, but not spectacular. Could it have been much better with more, or better directed or planned, effort? Almost certainly yes.

A business (or race) plan that anticipates many opportunities and obstacles will help grow your business. Breaking this down into numbers helps demonstrate what effort or investment is likely to be required at each stage in order to achieve the desired outcome. This may be a training plan, a race day plan and a series of targets or a business plan with forecasts, projections and sensitivity (or what if) analysis.
Or are we happy to have a wait and see attitude and let outside circumstances guide our performance rather than manage our own destiny?

And for the record…..I had a terrific day and can’t wait for next year's City2Surf!

The bank wants a forecast for my business! Where do I start?

If you are looking for a bank (or indeed anyone else, not just an investor) to support or advise on your business then you are going to need to give them information. Trading history is invaluable, and essential in many cases, but what most people will want to know is how the business will perform in the future. Short of having a crystal ball how can you show this and, most importantly, how can you convince others that your forecasts and projections are accurate – or at least fair and reasonable.

For an established business, trading history is the place to start - although not an indicator of future performance as we are constantly reminded with superannuation and other investment advice! However what you will get is:

• A framework or format for the forecast – this should be the same as your financial reporting for reasons of consistency and accountability
• A comparison which can lend credence to projections

No history? New business or business idea? The same principles apply but the starting point will change. Before you even look at an accounting system your business plan (or feasibility study) should set out your business as you wish to see it. This can then be converted into a chart of accounts (and/or budget) and then uploaded/imported/copied into an accounting system. Most systems will offer you a default chart of accounts but that will often be too general if you want to measure and control your business – if you just need to give something to your accountant to prepare the tax return then the default will usually be more than adequate. You really need to consider how you want to look at your business – professional advice is always a good idea but ultimately the decision is yours, most professionals will be able to put this vision into reality (or a model thereof).

Financials are what the bank most wants to see but the rest of your business plan needs to support this and demonstrate how the figures will be achieved (eg with a marketing plan). This is more important for a new business venture or a significant change over prior results.

Your forecasted projections are not just done once – forecasts should be regularly revisited and updated in light of current circumstances and performance and to take full advantage of future or potential changes, internal or external. The closer this is aligned to regular management reporting, the easier and more reliable will be the whole forecasting process.