Planning for the Future

Written by Diane M. Calabrese | Published December 2024

 

Adages pile up when we consider the future. We all know the lines like “the best-laid plans” (credited to poet Robert Burns); and when a garden or any well-planned effort disappoints, we recall such refrains.

No amount of planning brings guarantees; that is true. Also true is that the absence of planning invites chaos.

While new business owners may think about writing a business plan as daunting, veteran owners would not consider operating without a plan. The clarity a plan sets out is a guide developed from aspirations.

The plan allows an owner to check and verify that none of the simple stuff—often called the low-lying fruit—has been overlooked. “The easy part, when looking at the future, is the ability to use past data to feed into the planning along with reviewing monthly and quarterly sales trends for subtle adjustments,” says Mike Gruver, general manager at Hydrus Detergents in Estherville, IA.

When the vagaries of the world overtake a business, however, there’s a lot more to it. Which is the most difficult dimension of planning for the future of a business?

“Trying to account for and adapt to outside influences,” says Gruver. “Global geopolitical dynamics and how those outcomes change availability and pricing of certain materials is one of the outside forces.”

“There is also the unknown of weather patterns,” says Gruver. “Certain raw materials are extracted from agricultural products, and annual yields impact global availability.”

It will never be a simple matter to recover from a tornado or flood damage. But it will be a lot more difficult—unnecessarily so—without a business plan.

That’s because the business plan ensures that structural parts of a company get tended to in a timely way. Insurance and licenses never lapse, taxes get paid, and so on. Basics are in place.

“Without a plan, a company lacks focus and discipline,” says Gruver. “As a previous manager who was a Vietnam Marine vet used to always tell us: Plan your work. Work your plan. Without a plan you can’t go into battle.”

A plan is a framework. It’s not a rigid template. Flexibility takes priority in any difficult situation. “We’ll always adapt to changing circumstances over time, but a well-thought-out plan drives your business forward,” says Gruver.”

Planning for the future begins with the staid year-to-year business plan. The plan allows goals to be checked as met or in progress. It’s the foundation on which the company builds.

What happens years down the road? The future involves more than just growth. Might there be additional products or services? What about movement into more regions? How long does an owner plan to hold the reins of a business—might he or she sell it one day?

The whipsaw that moves in the space between exhilaration and disappointment is one we all know well. Business owners experience it and so do gardeners.

In fact, the garden serves as a good example of how even when things do not go according to plan, the garden still gets a bit more vigorous each year—perennials take hold and multiply, the soil builds a better organic layer, and shrubs and trees mature. Even when a drought in June and July reduces the yield of annuals, including vegetables, the garden is building year over year.

So it is with a business. Many things may go wrong, but a lot goes right if the business moves in a methodical way.

Prepared For Progress

“To design the future, it is necessary and essential to start building and planning a solid and realistic business plan,” says Bruno Ferrarese, copresident of Idrobase Group in Borgoricco PD, Italy. He emphasizes being realistic.

“The more challenging part is developing a feasible business plan,” explains Ferrarese. “To achieve this, it is essential to carefully analyze socioeconomic and political variables, which are influenced by external factors that are difficult to control and interpret.”

Separation of the components of a company adds to the complexity. “For our company, which manufactures products in two countries and sells in 92 nations, these factors are further complicated by geopolitical decisions,” says Ferrarese.

When considering what comes next for a company, being able to define as many parameters as possible helps. Ferrarese explains that his company identifies three factors that it must consider to move in the right direction, a direction that is impacted by maximum precision and accuracy.

“The growing division of the world into two increasingly distant poles—the Western nations and the nations led by China—is one factor,” says Ferrarese. “The situation requires our company to adapt its strategies, starting with the consolidation of a strong base in North America for the distribution of pump spare parts. Subsequently we expand the offering to other innovative product lines made by our company.”

A second factor emerges in conjunction with the environment. “The development of solutions to combat pollution translates into the innovation of our fog-maker systems,” says Ferrarese. “We are a leader in the design and implementation of advanced solutions for the abatement of PM2.5 particulate matter.”

A third factor surrounds power sources, especially avoiding combustion engines. “The development of battery powered, high-pressure washers involving close cooperation between our company’s headquarters in Italy and its subsidiary in Ningbo, China, is part of the shift,” says Ferrarese.

Alignment of the three factors is part of the future. “It will result in a development plan that integrates the three different divisions of our company—misting, spare parts, and industrial high-pressure washers,” says Ferrarese.

The integration will fuel growth. The company projects 18 percent growth in sales for 2024. It will also “target an additional 15 percent growth with flexible and specific targets for each product family,” says Ferrarese.

Establish a direction. Set goals that can be checked to stay on track.

“Having a strategic plan to follow is useful because the direction of the company is defined,” says Ferrarese. “In the case of our company, the direction to be taken is clearly defined and outlined.

“However, in addition to having a direction, it is essential to set one or more measurable goals in terms of value and time,” continues Ferrarese. “Therefore, turnover and profit targets must be calculated conservatively as the company’s cost and investment centers are based on these values.”

Ferrarese says his company has one definite plan, and that is for the near future. “With 25 years of experience and a fair amount of success in the Northern American market thanks to our Dolly Spare Parts, which are optimal for the manufacture and repair of high-pressure water pumps for which our company is number one in the world, we aim to consolidate our number one position in North America.”

How will consolidation be accomplished? “Our solution to consolidate and strengthen our leadership in the North American market will be to build a solid local operative base through a strategic partnership with a leading U.S. high-pressure washer partner,” says Ferrarese. “This approach will enable us to achieve this goal by the end of 2025.”

Strong Foundation

The future takes care of itself. Yes, in one sense it does.

Time is indifferent to indolence. It is also indifferent to industriousness. Yet in the big scheme of things, the hours that pass and the resources all around us seem to be gifts to be used and used wisely.

Although doing does not guarantee consistently good outcomes, not doing ensures bad outcomes. A positive future for a business—for any endeavor and for any society—begins with industrious people.

The first step for anyone who wants to launch a business is not to convert a fantasy of the business-to-be to text as is. It is instead to take a structured approach to writing a plan that will carry the business through its early months and first year.

The U.S. Small Business Administration ( SBA.gov ) distinguishes between lean plans and traditional plans. A start-up with a sole proprietor may choose to write a simple or lean plan. Such a nugget description of the business serves when securing any needed licensure.

Most creditors will want a traditional plan, which includes a summary of the business (especially how it fills a niche), a market analysis, and information about the organization and location of the business. Writing a traditional business plan to persuade lenders of creditworthiness is often the first foray into planning for the future that an owner makes. That’s because lenders typically want to know what the business will look like five years down the road.

A fledgling business must rely on projections extrapolated from the first few months’ financials (cash flow, balance sheets, etc.). A business with a longer track record has years of data on which to base projections.

In fact, when most owners of established businesses plan for the future, they know in their gut just how much latitude they have to take a new direction or meet another goal. They dream; then they plan.

With a tailored and temporized plan in hand, they do. Whatever happens, the successful business begins each new venture—each move in the future—with the best-laid plans.