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Do you have a business plan for your design business?Did you make a business plan when you started your design business? If you did, then you are in the minority. Most designers who freelance or run their own design business don’t bother creating a business plan unless they are required to do so by a bank or such.
I’m lucky; my bank asked for one when I first approached them for a business account. At the time I thought it was a nuisance, but in hindsight, I’m glad they made me do it. It gave me direction and made me think about what I wanted to accomplish with my design business.
So if you don’t already have a business plan, even if you’ve been in business for a while, you may want to take some time to come up with one.
Here are seven common business plan mistakes to avoid.
1) Putting off writing a business plan.
Most designers don’t bother with a business plan unless they’re asked to create one. Once their business is up and running most think they don’t need one, or that they are too busy running their business to make a plan for how to run it. That’s a big mistake. The busier you are, the more you need a plan.
Have you heard the term “work on your business, not in your business”? A business plan will help you accomplish that by helping you focus on the things you need to do to work on your business.
2) Fearing the business plan.
The thought of writing a business plan is much scarier than actually creating one. A business plan is not a thesis paper or a novel. It’s a simple guide for you to follow that will help your business to succeed.
There are plenty of great resources online and in your local municipality, such as small business development centres, libraries, banks etc. that can help you with your business plan.
3) Ignoring cash flow.
Most designers think in terms of profits and not cash. Profits are your sales minus your costs and expenses. Unfortunately, you don’t spend profits; you spend cash. And that’s where a business plan can help you.
When you are running a home-based design business, there are plenty of things that require payments that go beyond the business — things like utilities, property taxes, home maintenance, and so much more.
An essential part of a business plan involves creating a cash flow table showing you exactly how much of your profits get converted into spendable cash.
4) Establishing vague goals.
A business plan is not about the dreams you have. You don’t write “I want to be the best designer in my area” in your plan. That stuff is all hype. The objective of a business plan is to generate results for your business. And for results, you need to be able to track and follow up.
S.M.A.R.T. goals are a great way to look at a business plan. Your plan should contain specific dates, the responsibilities you need to take on, and the budget you are allotting to those responsibilities. Then set milestones so you can follow up and check your progress against your business plan.
No matter how well written your business plan is, it’s meaningless if it doesn’t produce results.
5) Copying someone else's plan.
There is no one size fits all when it comes to business plans. The resources I mentioned above can help direct you in writing your plan, but it has to be tailored to your specific business and needs. Remember, a business plan is a sales plan, a detailed action plan, a financial plan, a marketing plan and even a professional growth plan.
A business plan is essential for starting a new design business, but it’s also useful for running and growing your business.
You can bet that big design agencies such as Pentagram or Landor not only have a business plan but regularly review and revise it as their business grows.
6) Diluted priorities.
A business plan is meant to be a focused strategy for your design business. Therefore you need to focus on the priorities in your plan. A plan with 20+ items to keep track of is not very focused and will be much harder to adhere to. Each section of your business plan should have only three or four essential items you are working towards.
Remember, the more items you are focusing on, the less importance and less attention you can devote to each one. A short, precise business plan has a much higher chance of success than a long diluted one.
7) Not reviewing your plan.
Hopefully, you're convinced of the importance of having a business plan, no matter how small or large your design business. But having a business plan isn’t very helpful if you don’t review it on a regular basis.
Set annual reminders to review your plan and make amendments to it to help your design business grow. Doing so will help keep you focused and show you the direction to take to achieve to achieve success.
Do you have a business plan for your design business?
Let me know by leaving a comment for this episode.
Questions of the Week
Submit your question to be featured in a future episode of the podcast by visiting the feedback page.
This week’s question comes from Rosey
How do you balance multiple priorities? It causes me a great deal of anxiety to leave things unfinished. In a perfect world, for me, I would only have one thing to do at a time and could just work from beginning to end, but that never happens. If you're working on 4 things at the same time, and none of them are finished (that's me right now). How do you know when is the right time to stop working on one thing, and pick up working on another?
To find out what I told Rosey you’ll have to listen to the podcast.
Tip of the week resource name
I received a concise email from my copywriter this week. It went like this.
Here is the brochure copy. Let me know if there are any changes you would like me to make.
It’s that second line that gave me pause. “Let me know if there are any changes you would like me to make.”
In a way, she was encouraging me to make changes to what she wrote. I opened the attached Word document with the thought in my head to look for things to change. I didn’t find any, the copy was perfect, but the idea was there.
This got me thinking about all the conversations I hear, where designers are complaining about the number of revisions clients ask for. The usual solution I hear is to limit the number of revisions you offer. Or Charge for revisions beyond X number.
Maybe the problem is these designers are inviting their clients to make revisions by asking them if there are any changes they would like the designer to make.
Instead, the designer should be asking their client what they like and don't like about the design. If the client wants something changed they will ask without being prompted, so what’s the point of encouraging them to look for things to change?
If you are guilty of this, maybe you should alter your wording and see if it somehow reduces the number of revisions you’re asked to do.
It’s just a thought.
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I want to help you.
Running a graphic design or web design business all by yourself isn't easy. If there are any struggles you face running your design business, please reach out to me. I'll do my best to help you by addressing your issues in a future blog post or podcast episode here at Resourceful Designer. You can reach me at firstname.lastname@example.org