Planning For Results

Foremost in everyone’s mind for the last few months have been concerns as to how recent economic uncertainties will influence their business in the short and long term. Clarifying your business strategies now, and being open to necessary structured growth, can make all the difference in the months and years ahead.

Critically examine the direction that your business is heading, bearing in mind what it is that your customer base demands, is crucial to strategizing practical business planning. Comprehending what it is that your immediate business opportunities primarily are and understanding the demographics of the clientele in your area can effect the way that you present your business to them, and ultimately how you in turn are perceived by this market.

This is the key element in any equation that will secure the financial footing of your business. Basically what the market wants is to have its needs fulfilled. Know what your customer wants. A successful business will know their customer very well.

Planning creates opportunities and is a process to identify and evaluate strategic options.

Considering that “the most common ownership structure in the Canadian spa market is Sole Proprietorship at 43%, Partnership at 19% and Small Corporations at 22%”, according to the 2000 Spa Industry Study prepared by PriceWaterhouseCoopers, stagnation is a frequent and understandable occurrence for the isolated spa owner.

Isolation; lack of support, planning, and knowledge; and tunnel vision - these can be major limiting factors for the growth and success of any business. Spa owners can often get stuck in the day-to-day necessary tasks of running, manning and operating – just keeping the spa going. Currently the average net profit, after expenses but before taxes, in Canadian spas has been 19.2%, according to PriceWaterhouseCoopers. Many spa owners are not enjoying this kind of net profit, simply because they are too busy in their business and not working on their business. Stepping back slightly can give you the necessary perspective to engage the opportunity to grow.

It is more important to grow steadily and surely than to erratically expand without a strategy. Plan for expansion that will boost profitability without incurring unnecessary risk. Expanding the range of services you offer will have a protective effect upon the health of your business, but it must be done with caution and care. Be prepared to enhance your existing staff’s training rather than hiring new staff to facilitate a new service you wish to offer. This can have a two-fold effect, increasing your staff’s morale, which is directly manifested in the way they interact with clients, and it eliminates an element of risk that a new service brings with it. If clients do not readily take up the new service you offer, you still have a trained member on staff that can offer the service as an option to valued clients.

Why is planning important? Firstly, you have to know where you want to go in order to get there. Secondly, you need to know if there is a market for where you plan to expand and what you want to do. Do your market research and strategic planning. Proceeding with any expansion requires commitment to your plan, and an understanding that the changes, once begun, cannot be undone. Expansion and growth will change your business. If you are not well organized now and are experiencing problems, growth will cripple you as the problems only expand with your business. Your business cannot grow without experiencing change, but if you have carefully planned the process, your business will grow strong.

Once you have your plan in place, to support this plan you could also consider monthly staff meetings, quarterly business reviews with a mentor or coach or an annual “away day” for management, focused upon future growth.

Fundamental business strategies will indicate which form of expansion is most suitable for your business, depending upon how you currently market you business, be it through competitive price strategies or emphasizing better service and quality. These business strategies will dictate how you can benefit your business and grow it in ways that allow you to improve profitability and service.

Be less vulnerable to seasonal cycles; a resort that is very busy in either the ski or summer season may, for example, want to supplement services into the weight loss market, and so on, in the off season.

Successful growth requires a systematic approach, a comprehension and understanding of the relevant marketplace and is rarely the result of a fortuitous event. Your business won’t grow by accident. Growth must be pursued as an actual business objective. Once you have made the important decision to expand and strengthen your business by way of increased capacity, adding a new product line, forming a strategic alliance, or by any other means, there is no second-guessing. Plan ahead or plan to fail.