Growth is a constant concern for any business owner. Unfortunately, your MSP is not growing fast enough. Your revenue isn’t increasing. You’re plateauing.
When you hear the phrase “business plan,” you might have a few immediate reservations.
- I’m already working as hard as I can.
- I’m buried in reactive work.
- I don’t have the time or resources to take action on my plan.
- I need to finish a few things first.
- My company is small and doesn’t fit into a written plan.
These are common concerns among business owners in any industry, but they’re also critical reasons why you should have an MSP business plan. Don’t let your reservations keep you from investing time and energy into a business plan that facilitates MSP business growth.
Start By Looking Back
To create an MSP business plan that helps you achieve your growth goals, you have to evaluate where your company currently stands and where it’s been. Take a look at your MSP results and resources over the past few years.
- Revenue by categories – Recurring and nonrecurring revenue
- Gross margins by revenue category – Recurring and nonrecurring revenue
- Sales results – The amount of new monthly recurring revenue you’ve added
- Churn – The amount of monthly recurring revenue you’ve lost
- The people you employ
- The capital you generate
- The technology you offer to clients
Set Goals For Growth
What is the ideal state of your company? How much growth do you want to achieve? The next step in the business planning process is setting MSP goals.
Begin by defining four benchmarks that you want to reach.
10-Year Vision – What is the overarching plan for your company? Define big concepts for your business, like your purpose and core values. Establish a net worth goal that you want to achieve over the next ten years.
3-Year Targets – In the next three years, what big changes does your company need to undergo to make your 10-year vision a reality? Are there major structural shifts that would improve your profitability? Identify organization-wide changes that you need to implement, and set target profit margins for your team.
Annual Plan – Look at your company today and think about where you want to be one year from now. What annual sales goals do you need in order to meet your 3-year targets and make your overarching goals a reality? Are there growth targets that you want to reach over the next year? If so, outline a plan to achieve them.
Quarterly Actions – Take your annual plan and divide it into quarters. What actions should you take to reach both your sales and growth goals? Identify bite-sized actions your teams should take this quarter to keep your sales and growth initiatives on track.
At the end of each time period, check your progress and hold your team accountable. If you reach the end of the quarter and your sales goals haven’t been met, ascertain what went wrong or what impediments your team is facing.
Create A Success Pattern
Setting MSP goals is an important step in the business planning process, but making them a reality is the true key to optimizing your business and facilitating growth. Put your actions, plan, targets and vision in place.
To keep your team focused on reaching these MSP goals, employ the following tactics:
- Communicate your quarterly, annual, 3-year and 10-year goals to your team.
- Identify activities that employees should participate in to help achieve these goals.
- Commit to the process and keep your team accountable.
- Start today.
If you put off MSP business planning until you have more time or resources to focus on it, you’ll never get going. Take these actions immediately. Sit down and review your past, set goals for the future and create a pattern of successful habits for your MSP.
Every day that you delay creating an MSP business plan, you delay growth.
To learn more about business planning, download a free MSP business planning blueprint.