Developing A Business Strategic Plan – Winston Rowe and Associates

A strategic plan is a roadmap to grow your business.

 

Executive Summary

The Executive Summary is important since it will help other key constituents, such as employees, advisors, and investors, quickly understand and support your plan.

Elevator Pitch

An elevator pitch is a brief description of your business. Your elevator pitch is included in your strategic plan since it’s key to your business’ success, and often times should be updated annually.

Company Mission Statement

Your company mission statement explains what your business is trying to achieve.

Goals

They key is to first identify your 5 year or long-term goals. Next, identify your one-year goals; that is, what you must achieve in the next year for it to be successful and to put your company on the right trajectory to achieving your 5-year goals.

Key Performance Indicators (KPIs)

Great businesses understand their metrics and KPIs. By tracking your KPIs, you know exactly how your business is performing and can adjust as needed.

Target Customers

In this section of your strategic plan, you will identify the wants and needs of each of your target customer groups. This is important in focusing your marketing efforts and getting a higher return on investment on your advertising expenditures. This is because the more you can “speak” directly to your target customer wants and needs in your marketing, the better you will attract them.

Industry Analysis

Your industry analysis doesn’t have to be a comprehensive report on what’s going on in your market. However, you should conduct an analysis to ensure the market size is growing (if not, you might want to diversify), and to help identify new opportunities for growth.

Competitive Analysis & Advantage

Similarly, to your industry analysis, your competitive analysis doesn’t have to be a thorough report listing every detail about every competitor. Rather, in addition to defining who your key competitors are, you should list their strengths & weaknesses.

Most importantly, use this analysis to determine your current competitive advantages and ways to develop additional advantages.

Marketing Plan

In addition to your strategic plan, I recommend you develop a comprehensive marketing plan describing how you will attract prospects, convert them to paying customers and maximize your lifetime customer value.

Include a summary of your marketing plan in your strategic plan.

Operations Plan

Your operations plan helps you transform your goals and opportunities into reality. In this section of your plan, you will identify each of the individual projects that comprise your larger goals and how these projects will be completed.

Financial Projections

The final section of your strategic plan is your financial projections. Your financial projections help in multiple ways. First, you can use a financial model to assess the potential results for each opportunity you consider pursuing.

You should develop your complete strategic plan each year, and then update it monthly as actual results come in and you gain more clarity and intelligence. While you will rarely achieve the precise goals established in your strategic plan, scores of research show that you’ll come much closer to them versus if you didn’t plan at all. So, develop your strategic plan today, and achieve the goals you desire.

 

10 Fundamentals Beginning Real Estate Investors Should Know

  1. The Cup Is Always Half Full

New real estate investors are very nervous on the first deal and start to panic at every obstacle. These emotions are natural considering most are spending their life savings on an investment property. Never let your emotions get too high or too low because both can cost you time and money.

  1. The Value Is in The Experience

Your first flip isn’t all about the profits. Many first-time investors won’t make a killing off of their first property, so it’s key to keep in mind that there’s also value in the time spent managing the acquisition and renovations, learning from mistakes and seeing the project through to completion.

  1. Setting Aside Working Capital Is Key

Many new investors fail when they are hit with unexpected and major expenses or income loss such as significant repairs or a major tenant vacating. To avoid this, make sure to set aside enough working capital in reserves to account for these problems so that you can carry the property through the tough times.

  1. Discipline Will Help You Stay on Budget

First-time investors are sometimes so eager to get started; they will abandon their set numbers. This may lead to overspending on the acquisition or on the improvements. My most disciplined clients won’t go over their set budget. What seems like a negligible amount can impact returns.

  1. Return Calculations Can Be Misleading

In commercial real estate, it is very common to advertise cash on cash returns, capitalization rates, and internal rate of return for investment properties. I wish more early investors understood how easily manipulated those figures can be and that you could provide 10 seasoned industry professions the same data and come up with a wide range of IRR estimates

  1. Lying Will Ruin Your Reputation

Reality TV shows are pure entertainment and do not accurately reflect investing, so don’t rely on them at all for your education. Get involved with people who actively invest in your local area.

  1. You Won’t Get Far Without Mentors and Partners

There are successful investors out there, right now, with decades of experience, who would be happy to help you on your journey. Find a way to add value for them, and in return ask if they can help you in your real estate investing business.

  1. Having the Right Team Is Priceless

Working with a well-seasoned professional team is key. Often, real estate investors are looking to rent out the property, but the first-timers don’t work with a team of professionals to think through cost estimates, financing options, profitability and different aspects of being a landlord or occupancy rates.

  1. The Details Are in The Contracts

I can’t tell you how many people I have known, including myself early on, that just trusted the personality running the deal, and never understood what they were investing in.

  1. Plans Are Useless, But Planning Is Indispensable

We see a lot of first-time investors purchasing investment properties. While there is a multitude of impactful factors, the end reason the project is being done is to make money. To keep everything on track and in perspective, create a Pro-forma (projected) profit and loss statement to determine the impact and timing of decisions and investments.