As you manage the day to day operations of your company, it can be difficult to see beyond the of the week, much less the end of the quarter or year. But putting together a plan that maps out a strategy for your company over the next few years is key to your business’ success. A five-year plan allows you to create a strategy and work on achieving specific goals, whether you want to expand into a new area or launch a new product.
If you’re feeling overwhelmed with the daily operations of your business and aren’t sure where to go or what to do next, a virtual CFO can work with you to help craft a strategic, five-year plan. Once you have your plan, you’ll have a roadmap that can direct your business to where it needs to go.
Why Do You Need a 5-Year Plan?
Companies need five-year plans for various reasons. Creating a five-year plan allows you to visualize your company’s future. It helps you make more concrete plans, as the plan illuminates what your business’s goals are. Similarly, your five-year plan lets you set priorities for your company, based on the resources you have and the things you wish to achieve.
Five-year plans also allow your business to attract investor financing. Many investors like to review a company’s strategic plan before they decide to invest. An investor can use the information in your business plan to determine if your company is a sound investment.
Your five-year plan can also highlight any obstacles or challenges that might stand in the way of your company. Once you know what the potential obstacles are, you can find ways to work around or overcome them.
What Should You Include in a 5-Year Business Plan?
Your company’s five-year plan should include the following elements:
- A mission statement. The mission statement should sum up your company’s vision and purpose. The mission statement informs anyone reading the plan about your company’s reason for existence and why it needs to do what it does. It also influences hiring decisions and allows you to make plans and goals for your company’s future.
- An executive summary. The executive summary is typically the first part of a five-year plan. It provides a quick summary of the plan’s sections and provides an at-a-glance overview of what the rest of the plan will cover.
- A SWOT analysis. SWOT stands for strengths, weaknesses, opportunities and threats. A SWOT analysis gives investors and other plan readers an idea of what your company is facing and how it plans to respond to challenges or opportunities.
- KPIs and metrics. Business metrics include your company’s profit, revenue, conversion rate, customer retention and acquisition rate, and sales growth. It provides investors with the hard numbers they need to make decisions about your company.
- Business goals.Your business goals are the things you want to achieve over the next five years. They can include short-term goals, which you hope to achieve within the year, and long-term goals, which you hope to achieve within five years.
- Audience. The plan should include a description of your company’s intended audience, including basic demographic information. You can also include details about how you want your audience to grow and change over time.
- Competitors. Include a section on your company’s competition in your plan, and information on the factors that make your company unique.
- Marketing plan. The plan should also outline how you intend to market your company.
- Financial details. Your plan should provide investors with information on your company’s financial standing and its projections for the future, including information on how you foresee revenue or profit increasing.
- Team members. Include information about the relevant members of your team in the plan, including biographical information about your founder, CEO, and other executive officers.
How a Virtual CFO Can Help You Create a 5-Year Plan
Putting together a five-year plan can seem like a lot of work, but you don’t have to do it on your own. The virtual CFOs at New Direction Capital can help you create a strategy for your company’s growth and development over the next five years. Contact us today to learn more.