I am a big proponent of business planning because I believe it is our business plans that allow us to create bridges that cross giant chasms and help us reach opportunity on the other side. Planning helps us anticipate options, improve our opportunities, reduce our challenges, and be ready to function profitably in any business scenario.
But not all business planning requires the crystal ball of anticipatory research to peer into the future and discern what will happen. One example of this is demographic research that will help you project how things will likely change in the future. Will your demographic still be buying the same things tomorrow that they are today? If your current demographic ages out of shopping at your store, are there enough new people entering the demographic to maintain your same income?
This is valuable business planning that you need to do because it helps you think ahead and allow for many circumstances.
On the other hand, I believe that some looking backward will help as well. Keep a logbook of things that happen on a daily basis. Then review and observe how different elements have an effect on your business.
- Keep track of what your competition is doing: Do you notice that your sales decrease only when your competition holds a 50% off sale but all other promotions they do have little effect on your customer base? Perhaps you need to make the most aggressive sales campaign when they unleash their 50% off sale.
- Keep track of the weather: Does bad weather keep customers away? Or perhaps it brings more customers to your store? Do customers tend to buy certain things on certain days? For example, do coffee and hot chocolate sales rise in the winter? Do sock sales drop when the weather reaches a balmy temperature? These might seem obvious but there are likely subtleties in every business that are affected by weather.
- Keep track of local and national events, such as sporting events, tournaments, elections, marathons, large fundraisers, as well as any special day (like Valentines Day or Mothers Day, etc.) Do sales of certain items increase or decrease during this time?
Don’t forget to look backwards in your logbook to see how previous events or trends affected the sales that followed. An obvious sale would be an increase in holiday foods like turkey or ham around Christmas, but a less obvious follow-up product surge might be the increased sale of dietary supplements in January (following the traditional Christmas feasting and the New Year resolution of losing weight).
Once you’ve kept this logbook for a month, look back and see what trends exist that you may have missed before. You probably already know the days of the week that are busy for you, but what about the days of the month or even which week of the month that’s busiest?
A daily logbook is a commitment, there’s no doubt about it. If you find that a daily logbook is too much of a commitment, consider a weekly logbook at the very least. (If you use a logbook that is less frequent than that, it may lose its accuracy). Either way, if you want to enjoy the benefits of planning ahead by looking back, you will need to commit to faithfully filling out the logbook. It may seem like a lot of work on occasion when you just want to call it a day, but the decision to do that now will pay big dividends in the future as you uncover trends you never knew existed, and then act on those trends to increase your business.