Planning the next six months from your Lockdown results…
Lockdown and the events of the last few months have repeatedly, and understandably, been called ‘unprecedented’.
No-one could have predicted the impact of Coronavirus on businesses up and down the country.
What we can do now though, is make sure that we look at the effect those circumstances have had, and use the information to update our plans for the coming months.
In this video, we’re explaining why it’s important, and how to do it.
Hi, and welcome to another episode of Baranov TV, designed to demystify the world of accounts and tax, and to help your business grow.
We’ve already established, in earlier episodes, and our Rebound Resources, that the last six months have been pretty unprecedented.
But we are now, really, for most businesses, far enough through lockdown to have a more settled view of how businesses, how a business is performing, and how it’s likely to perform over the coming few months.
A majority of client businesses are at the halfway point in their year, because the majority of them have a March year end. So we’re about coming up to the six month mark on those businesses.
Ordinarily it is time to review things like your business plan, to see how things are going, and how you’re performing against your targets and goals that you set for the year six months ago.
We already know that business plans have gone out of the window! All that we’ve been focused on over the last few months has been survival, reopening, and just trying to get through the chaos and the uncertainty that the pandemic has brought to all of us.
We’re now far enough through now to have a ‘new normal’.
- We’ve got the cash in place.
- We’ve been reopened for a reasonable period of time, so we can see what impact reduced footfall, potentially, or working from home, whatever it may be, what impact that has had on our normal level of income, and our normal level of sales.
- We’ve got staffing sorted, so if you’ve had people on furlough, you’re starting to get those back. The kids, as I record this, we’re the first week of September, the kids are starting to go back.
Taking all of that into account, we can get a much clearer idea of how the coming months might look.
We’d suggest therefore, that you have a look at your business plan, and go back and look at what’s gone on over the last six months, and start to update your plans based on those figures.
The pandemic may have forced you down different ways of operating, so you may not be operating as efficiently as you would previously have been.
You may have found that actually you’re much more efficient, I don’t know, but think about the efficiencies. Step back, and review how things have affected you, and see where you need to make some more changes, where you perhaps need to pull things back a bit more into line.
Now that your staff are back working in your office, have they got used to maybe not being as focused as they could be while they were working from home.
Does your Business plan reflect your current business model? Are you now working from home? Have you gone back to the office?
What impact has social distancing had in terms of your efficiency, and your model, and the business practices?
How has your volume of sales, per product, or per service been affected? It’s likely that those have changed.
Strengths, weaknesses, opportunities, and threats
A standard section within a business plan is that you review your strengths, weaknesses, opportunities, and threats. When you do that, there may have been quite significant changes in one or other area of that.
- It may be that your competition has disappeared.
- Has your team stepped up markedly through lockdown?
- Have you found new services or products that you can exploit for the future, alongside your previous existing business?
It may be that there are big areas of change within one of those sections.
We would suggest you pay particular attention to the opportunities side. We’re seeing quite a few clients that have managed to really see, and exploit some opportunities within their industries, and within their markets, over the pandemic, and the lockdown, and coming out of it. So now there really is a good opportunity for a lot of businesses to seize the day, almost.
- It could be a new way of working.
- It could be new sales streams, or methods.
- It could just be that some of the ways that you had to be creative during lockdown, to actually make those sales, are additional revenue streams for you now that we’re all back and trading as normal.
We’ve got a local cafe that obviously had to close. They’re now selling (chocolate) brownies, nationally, by mail order, and by all accounts they’re doing very well. They’re not about to stop that, now that they can reopen; they’re going to keep that going because it’s another revenue stream, and it doesn’t actually mean that there’s that much extra outlay for them to maintain that.
The changes in your business plan will lead to changes in your forecasts, so your cash flow, that we’ve talked about in the past, and also your profit forecasts, if you have them, are likely to have been affected.
Make sure that you’re in a good position to have a little more clarity for the year. Despite all the uncertainty that we’ve had, you’ll be in as good a position going forward as is possible.
This exercise will let you know what the shortfalls may be for the coming period, and what any surpluses may look like.
If you have managed to come up with new revenue streams, new products, potentially new services, how is that going to affect your figures for the coming future?
Do bear in mind, that particularly when you’re looking at threats and opportunities, that one of those threats will be local lockdowns.
If we do have to go into either a local lockdown, or if there is this fearful second wave, what impact that may have on your business?
Try and make sure that you’ve got some sort of fallback position, in terms of contingency funding, so that you can get through, if you need to.
You know now the impact of full lockdown, and you should be able to plan a little more carefully for a second. Let’s face it, no one had a plan for the first one!
You should be able to plan a little bit more for what happens if we have to do it again.
- What if it happens at a local level?
- What if a member of your staff becomes infected with COVID, and you have to close? There are some local businesses to us, that have had to do just that, and they’ve had to put notices on their door to say ‘we cannot open’. What would happen to you if that happened in your business?
Think about those sorts of things as you’re reviewing your current planning.
The finance options.
If you haven’t already taken out any of the Coronavirus finance that we talked about in an earlier episode, then do make sure that you’ve explored that fully, and that you’re absolutely sure that you don’t need that, and you won’t need that, because we’re coming towards the end of those schemes. CBILs stops at the end of September, so there isn’t that much more time, if you do think you might need it, that you can actually get your application in.
As ever, if you’re not sure, do come back to us, do give us a shout. We’re more than happy to try and help you make some sense of what you’ve been through, and help you put yourself in the best position possible for the coming six months, or whatever’s left of your year end.
What we’re trying to do is make sure that your accounts this year look as positive as you need them to, as actually you want them to, and make sure that you are as secure as possible as we come out of this position.
So do get in touch if you need to, happy ‘reviewing all of your plans’, and I’ll see you very soon.
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