We have massive expectations at the end of a year headed off into the wild optimism of what a new year might bring…new products, new opportunities, new revenue goals.

And then we look up and it’s March…June…August…and we do it all over again hoping that we’ll take it more seriously next year, but never stopping to make the time to give next year the pre-planned attention that it both needs and deserves.

It would be silly to show up to an event and the organizer welcomes you with this statement, “although this date snuck up on us and we just sort of woke up to the reality that you all were coming, we’re hoping to make this a great event and are glad that you are here…so let’s make the best of it!”

You would be infuriated and frustrated.  All of the time, attention, and investment it took for you to attend that event; and the event organizer treats it as “not a big deal” that they are not prepared. 

This is how many of us live out our year to year, on the year-end treadmill that methodically and non-dramatically waltzes us into a new year hoping it will be better, but knowing that we did not put in the pre-planned work to ensure that better will happen.

How can we ensure that we take advantage of the freshness of a new year and launch into an optimistic twelve months having laid the groundwork aligned with a vision of what we see?

Here are four steps to building an annual business plan.

First, you must make time to plan.  

“I just can’t find the time…or don’t have the time.”

We all have the time, but you will never make the time if you don’t first go and find the time to make.

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We all have time, and we all have a choice in how we spend that time. 

SPEND time.

Time is a non-renewable currency.  Money is renewable.  Time is not.

You have a finite amount of time which makes the value of that currency wildly expensive. 

The tasks that you constantly get caught in, are they worth the value of the currency of your time.

You have the time…you must now make the time you have to prioritize preparing for the time that is coming.

Make the time to plan.  Schedule it in your calendar.  Communicate it with your team and your clients and customers.  YES!  They will appreciate your intentionality.

Second, spend the first part of your annual business plan on the vision of your business.

There are three elements that will provide clarity in your vision, so you and everyone else knows where the business is headed.

Remember, wisdom tells us that where there is no vision, people scatter.  So let’s follow the ancient Jewish wisdom to write the vision down so those who read it may run. 

You should have a written vision detailing the snapshot of the future of your business.

With that vision should also come an annual letter that brings clarity to yourself, your team, and your stakeholders and friends.

The best example of an annual letter is the 1997 Amazon Shareholder Letter from the pen of Jeff Bezos.  It’s powerful and filled with vision.

Write an annual letter each year so you have a vision template of what is coming, along with a chronicle of what has been.

It’s powerful to go back and read what you were thinking back then.

Third, you should spend the second part of your annual business plan on the financial preparation of your business.

Every business will be served well by subdividing their bank accounts so that the revenue that flows in may be allotted to its appropriate destination (profit, cost of goods and materials, taxes, compensation, and operating).

Financial planning comes with time spent on subdividing the infrastructure that holds your cash.

Also, every business ought to have a simple dashboard that tracks the ABCs of the business; cash Accounts, Bookkeeping (receivables, payables, etc.), and Customer metrics (leads, touchpoints, views, etc.).

No business is complete without a simple budget.  SIMPLE!

A best practice is to go back and review the last few years of your business profit and loss statements to review the cost codes and categories.  Evaluate your various expense categories, update where necessary, and then begin to apply anticipated dollar projections to each one based on the vision of the business and where you see it headed in the coming year.

The fourth step of a proper annual business plan is our own personal preparation.

How is your personal estate setup?  Do you have the legal instruments in place you should have; written agreements, contracts, powers of attorneys, will(s) and trust(s)?

Have you met with an attorney to go over a list of legal instruments that will help protect you and your business in the coming year?

The same holds true for insurance?  Are you overinsured or underinsured?  Have you had an insurance advisor walk you through your insurance options, needs, and future realities?

Personal preparation culminates with an exercise we call the Financial Barn.  A storied exchange took place between a sage and a wealthy man.  The wealthy man was bragging about the growth of his farm and how the yield on his crops grew exponentially requiring him to either put it to use, give it away, or to build bigger and bigger storage facilities.

The man decided to increase his real estate portfolio with more storage barns where the produce would sit.  In his mind, he thought, “I’ll have plenty so I can eat, drink, and be merry.”

The sage responded, “you fool, tonight you will die…and what will happen to your stuff” (my paraphrase).  

It is not wrong to save and store….and it is also not wise to hoard up and build bigger and bigger barns to hold more and more stuff.  

A Proverb says, “in the blink of an eye wealth disappears, for it will sprout wings and fly away like an eagle” (Proverbs 23:5).

A Financial Barn simply outlines the size of your “barn” for the upcoming year, and anything more than that is given away or sold off.  It’s a powerful exercise of generosity, contentment, and taking care of what we have.

With these four steps of an annual business plan, you make the time, cast the vision, set the budget, and ensure the integrity of the business that you are building.

Owning a business is a powerful gift and a burdensome responsibility.  We must treat it as both.

Scott Beebe is the founder of Business On Purpose, author of Let Your Business Burn: Stop Putting Out Fires, Discover Purpose, And Build A Business That Matters.  Scott also hosts The Business On Purpose Podcast and can be found at mybusinessonpurpose.com.