The Law Offices of  Barton Morris

Business and Strategic Planning -Simple, Effective, and Necessary

“If you have no goal, it’s impossible to achieve it. “


Why Business Planning is Necessary


Studies show that small businesses who perform written business plans are 30% more likely to succeed and are 50% more likely to achieve their business goals. There exists a reason for this and it remains true. Business planning is oftentimes overlooked and undervalued to those not accustomed to them but they are so important.

Without a plan, you are leaving the success of your business to chance. Some business owners can be successful by chance, but most people cannot. Further, most people can never reach the levels of success that they need to or expect to acquire.

Without proper business planning, they don’t even realize their potential. They will never be able to chart a course upon which they require success, and instead aimlessly move towards success that is undefined, and times not even appropriate given the circumstances. Consider driving without a map but you need a destination.

You need a goal and those goals must be smart goals. If you’re trying to get to Florida from Michigan without a map, you’re likely to drive in a lot of different directions. As opposed to the one that will get you there, quickest, most safely, easily and with less stress.

This is the same with running your business. Your business needs a roadmap, and it needs to be created properly. It needs to be sound, smart, and realistic. It needs to include strategy and it needs to be wide-reaching in the sense that our goals should be worthy of our hard work, not small and unworthy of our time.

I have helped dozens of businesses achieve their success by using this simple but effective planning advice. It provides structure, forces you to think strategically, and provides a sense of urgency. You will learn that life is short and if you are not actively and currently working towards your goals, you are probably spinning your wheels.

Driving Without a Destination, you are Bound to Get Lost

Many crucial reasons exist for creating a business plan. The business planning that I will be writing and referring to will be for the sole purpose of the owner and its management. Although there are many other reasons to do so, and many types of plans.

For instance to source and acquire funds needed to fund the business and ensure it’s got adequate capital. This is a legitimate reason for a business plan, but not the one which is the subject of this article.

The office of Barton Morris is interested in small businesses, creating business plans to ensure their success, and to ensure the achievement of their goals. Part of that certainly may include the importance of raising at the correct amount of capital but in this case the plans contemplated in this article are for any business no matter whether it’s a start up or whether it’s been in business for 40 years every business should have goals.

Every business should define those goals in writing, and every business should have a strategic, well thought-out, and articulated plan to achieve those goals. That plan should be amended, reviewed and changed periodically to ensure it is not outdated.

Business Planning Starts With You – Work Backwards from There

In any business, there are usually about seven parts of a business including sales, marketing, production, factory, people, and finances. The “you” in this scenario is the CEO, the owner of the business. Often the owner of a business is multiple people, but whether it is one person or multiple people, even a group of investors, or even publicly held shares. Yet, building a business plan starts with you.

The business plan starts with you because the CEO doesn’t work for the business. Alternatively, the business works for the CEO. It is with the CEO or the owner’s goals in mind that we then can create the goals of the business, because the business is essentially the strategy that delivers the goals of the CEO. Therefore, start by discovering what the goals of a CEO are.

The goals of the CEO will change with any business whether they are goals to achieve a quarter of $1 million a year in profit a half $1 million a year and profit or several million dollars a year in profit we must first start with the goals of the owner. There is work that needs to be done here.

The CEO needs to understand how much they want to live on. If this is not performed with specificity, the business will never be able to succeed, because the owner has not set up the goals for its success.

Without a goal, you cannot achieve it, nor can you provide yourself, your staff and your vendors with the opportunity to achieve success. Do not rob them and yourself of the opportunity because achieving a goal is a very rewarding and motivational experience.

Competitor Analysis, USP, SWOT Analysis

Success in business often requires analyzing the competitive environment. If there is no competition, that makes profitability a lot easier, but with a great deal of competition, it makes profitability more challenging. Thus, requiring a competitive market analysis.

Someone is setting the standard, someone is delivering and obtaining market share. What are the reasons why your competitors are ahead; why are they winning?

You will need to have a strategic and competitive advantage. What is your ideal client profile (ICP) and unique competitive proposition (USP)? Where are your competitors weak and you are strong? Where are you strong and where are you weak? Is with these questions that you identify where you must get strong, and where you can succeed over your competitors.

This is good information for a business plan because the plan is also a place where you are engaging in strategy. The proper plan doesn’t just contain a bunch of vague numbers. It must also include how are you planning on achieving those numbers and what your realistic goal for doing so and your strategy for doing so.

Profit Model Assumptions

There may be several assumptions in your business plan and one of them will be your profitability percentage. You may have a target 20% profitability, meaning every time you sell something for $100 it took $80 to make it. A target profit margin may be 30 or 40%.

Profit models differ by industry. Judging on your past performance, industry standards, and projected or desired goals. You will likely create a profit model assumption for which you can target.

A typical profit margin lies between 20% and 40% depending on the industry. It also depends on the maturity of your business, the market and of its competitors.

Understanding the profit percentage and having an estimated profit is crucial for your business plan. By setting a profit goal, you can easily determine the number of sales needed to achieve it.

For instance, if I have a total owner benefit (from the owner goals exercise above) of $750,000 a year in profit, and a 25% projected profit margin, I know that my total revenue will be 3 million which is 750,000÷25%. The rest goes to operating expenses or cash reserves. With that you can then go to the next stage how are you going to spend your $2,250.000 of operating expenses

Projected Financials

Our example above allocated $2,250.000 in operating expenses. A simple business plan can divide that into different categories including: overhead, labor, and cost of goods sold. Perhaps 30% goes to labor, 15% goes to overhead, 30% to marketing and 25% to the cost of goods sold. Then it would look like this:

Labor 675,000
COGS 562,500
Overhead 337,500
Marketing 675,000

Then, you can break these numbers down to their individual components. Labor may be divided into management, administrative, and manufacturing. Usually sales will align with marketing.

The COGS allocates to particular SKU’s to create a strategic product line. This is different for every business, but every business has operating expenses which requires proper planning.


Every business is selling something whether it’s a product or a service. Therefore, the sales department is of critical importance. Maybe you have actual salesmen, or perhaps owners doing the sales, or perhaps your sales are the physical displays of your retail items.

Sales must be a part of every business plan. Planning for efficient sales you must understand what your average sale per SKU (sales keeping unit) is. For instance, if there is an overall average sale price of $10,000, and we know we have to have $3 million in annual sales. We know we must have 300 sales that year.

This is helpful to know because we can then break it down: by quarter, by season, by month, or even by week. This is how sales targets get set and even compensation models are figured.

Your employees should get compensated for hitting their goals which align with the company’s goals. Understand what the conversion rate of your salespeople are. For instance, if there’s a 50% conversion rate and if you need 300 sales, that means you will need 600 qualified leads. This is where marketing comes in.


Our business plan, as far as targeting 600 qualified leads, is the marketing department’s responsibility. Marketing generates leads, but only qualified leads can turn into sales.

Perhaps you have a marketing department with activities that deliver leads, but 75% of them are qualified. That means you need 800 leads to end up with 600 qualified leads (600/75%). Your marketing plan will identify how the marketing department or your marketing activities will generate 800 leads. This goal equates to 200 qualified leads per quarter.

Perhaps there are five different marketing channels, each looking to generate 40 leads each quarter. These could be: print ads, digital marketing, organic website traffic, pay per click (Google, Facebook, etc), or possibly business referrals.

Whatever they are, every business has marketing. Some are less obvious than others. For instance, some businesses generate business through word of mouth or referrals. Those are still marketing channels and if a business seeks to scale, oftentimes marketing is where that will begin.



Conversions made from the sales department must be onboarded to production for adequate delivery of your product or service. There needs to be a smooth transition (which is the topic of a later article). Ensure your company has the production capacity to handle the sales volume.

When scaling your business, this may require attention. Is your factory (office, retail location(s), factory) of adequate size to accommodate the sales? Do you need more equipment, shelves, office space, computer hardware or software? Will your anticipated increase in production be within the financial projections made above?

The business plan will detail these considerations.


You have to have the staffing in place necessary to meet the production requirements. This may require a staffing plan where you seek to increase your staff to accommodate the sales conversions. You can segment this efficiently quarter-by-quarter. Perhaps in the third quarter, you will need additional assistance in various departments.

Plan now to prepare yourself for later. The recruiting and hiring process can take several weeks, if not months so planning your company’s staffing needs will be critical. (Stay tuned for an upcoming Article about How to Build Your Rockstar Team).

Strategic Planning 

Strategic planning is a crucial part of your business plan. Announcing your goals is one thing, but planning how the business achieves those goals is another.
They will not just happen simply because you wrote them down. And while I am an advocate of “manifesting”, I also believe we have to have the right strategy for success, and then deploy action.

Strategies can center on a great deal of topics. Better team training, increase average sales value, adding key employees, implement new marketing campaigns, hire a CFO. Whatever they are, I suggest setting a date for the plan, and calendar the steps necessary to make it happen.

Using a 12 month calendar is a great way to plan your strategies. They often require time to implement, so putting the goal on the calendar and working backwards, is a great way to ensure your plan will be addressed.

For example, you may have a goal of increasing your qualified leads though better social media marketing. You may choose a KPI like number of followers on one or more social media channels and give yourself six months to accomplish that goal. Put that on the calendar “on July 1, I will have 1000 engaged followers on my business LinkedIn page. Then work your way backwards.

How are you going to do it? Perhaps post more often, join more groups, or collaborate with more people. Put those goals on the calendar. Set benchmarks like a three month goal – have 500 followers by May 1. This can be done with anything, and it should.

If you think you will just start doing something when “it’s convenient” you will never get it done. Plan your success both for your goals, and the strategies you will employ to achieve them.

Review and Adjust Quarterly

A proper and refined business plan is not “set it and forget it”. Amend, add, delete, and alter the plan regularly. At least one time per quarter, evaluate and amend your plan based on recent events.
Rarely does the business operate perfectly according to plan. If there are significant changes from what was expected, the reasons must be evaluated.

Perhaps additional strategic planning is necessary and/or the projections changed. You may find that your projections were under or over estimated. This is a great learning opportunity because the closer your plan is to reality, the better plan it becomes.

Plus, you will want to do this plan on an annual basis. So the prior year’s plan will be helpful in creating next year’s business plan. I suggest starting the following year’s plan in October and have it finished prior to the November holiday. Adjustments will likely be necessary in December when the fourth quarter ends.

Business planning allows the business, its CEO and all its employees to have goals to achieve. Without setting clear, identifiable, realistic and lofty goals, no business can reach its potential.

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