Ep 183 | Plans Are Nothing; Planning is Everything

Thank you for joining me today. It's Brian Gubernick, and welcome to the No Days Off podcast, where we believe that every single day brings a new opportunity to get better. Let's get into today's topic. Today I want to talk about planning, and I want to start off by quoting Albert Einstein, who first said this, and I think Dwight D. Eisenhower followed by using the same quote or something very similar. They both said, plans are nothing, planning is everything. Plans are nothing, planning is everything. Now, what is meant by that phrase? Well, I know when I researched it a little bit more, around when Eisenhower first shared it. Eisenhower believed that he was highlighting the importance of the process of planning rather than the actual plan, the specific plans themselves. The idea here is that the circumstances may change, situations may change, the need to evolve a plan may change, right? You're going to have to adjust your plan, but the act of planning is what actually helps individuals and organizations prepare for a variety of scenarios, anticipate certain scenarios. So plans are really nothing, but planning is everything. On that note, I want to talk a little bit about planning in your business and a little in your life today. Uh, just last week, my partner Ben Kinney and I, we held our Metrics Mastermind event, the quarterly event. And Ben went through a section around planning. And we have all these entrepreneurs, all these business owners in the room. So naturally a lot of the planning had to do with business, but then it was also around income and investment and tax planning. Because once your business is successful, obviously you're grabbing money from that business, hopefully mitigating taxes and investing those dollars. Now, as it pertains to the business plan, and I want to ask some— ask you some certain questions today, things for you to start thinking around as it pertains to the business plan. A business plan, or what's involved in a business plan, really is your revenue, your cost of sales, your expenses, and your net income. Revenue, cost of sales, expenses, and net income. So the first question for you today around your business, I'd like to reverse engineer this. I like to go profit first. What is your desired net income for the business in 2024? What is your desired net income? Now, most in their planning think about what revenue are we going to create. I don't want to start there. I would encourage you to start with your net income. How much do I want this business to make? Now that I've established that figure, now let's back into the other figures. What can my expenses be and what must my revenue be in order for me to achieve the income goal I just set out? Again, typical planning is from the top down, meaning it's revenue, then cost of sales, then expenses, then net income. But today I want to challenge you to go from the bottom up. What do you want to see this business make? And now let's back into the expenses that we'll need to make that money, and then naturally the revenue we've got to accumulate. So now that we've got— we've, we've thought through those numbers around your revenue, the question then becomes where are you at today? So what were your 2023 sales? And where must you go tomorrow, which would be your 2024 sales? How do we connect the dots? How do we close the gap between where we're at right now and where we must go? So when you're thinking about your business plan, how much money do I want to make? Now let's back into a revenue figure we have to get to. Where were we at yesterday? So 2023, where do we want to go? How do we in fact close the gap? What systems What people, what mechanisms must be in play for us to get to the revenue we want to get to? From there, we can calculate in our cost of sales and how we have to adjust or manage the cost of sales. In the real estate sales business, cost of sales would be your agent splits, your agent compensation. If you're in a product-based business, it's the cost of your inventory. Then you can figure out what your expenses need to be. And your expenses should be heavily built around your infrastructure and the salaries and the things that, that have to be in play to support the revenue creation. So what is involved in your business plan? It's, it's backing into a net income figure and it's connecting the dots. If you have not started planning yet, okay, cool. Let's start getting into it. Remember, planning is where the money is made, not the plan itself. Let's start thinking through these numbers and have a vision for where we want to go. Now, once we've gone through the business plan, I would, I would focus on, and as Ben talked about last week, let's move to our revenue plan, right? Our business is going to be dependent on the revenue that we create. Where were we at last year with respect to our revenue? Where do we want to go? What's the gap? Now let's create a plan to solve for that gap. If you did $1 million in sales and you want to do $2 million in sales, How are you going to create an additional million dollars? That is the planning process. As you've gone through the business plan, you've gone through a revenue plan. If you're in the sales business, if you're in any business, now you got to talk about your people plan. Your people plan, right? Meaning that how many people do I need? Maybe it's salespeople, maybe it's infrastructure, customer service, whatever it may be. How many people do I need to support the lead, the sales I want to create? If you're in the sales game, how many leads do I have to have coming in? How many sales reps do I need to convert those leads? How many sales must I actually— transactions must I actually create? And then of course, what sort of support in terms of infrastructure is necessary? This is around your sales and your salespeople. Finally, I'd get to my income plan. Now this, this is not your business income. This would be for you as the business owner. Right? So we're going to talk about what would your business net, but what are you going to net from that net? In other words, are you going to take dollars out of the business? If so, how much? How much do you desire to have? How much do you desire to reinvest into the business? What other income will you personally have? Do you own other businesses? Do you have investments that are going to be sending things your way? What will you actually need to cover your personal expenses? In 2024? After you've created income and you've covered your personal expenses, how much do you actually have left over that you can now, you know, go and invest, right? Will that give you enough to honor where you want to go from an investment standpoint? Or maybe you want charity in there. Do you have enough money left over post-expenses for that charity? This is the planning process. If you walk into 2024, you're just going to play the game of more, right? Just go and accumulate for the sake of accumulating. But where does it lie with respect to a plan is critical for any business owner that wants to have a high level of success. You've got to know where you're going in order to actually take the steps to get there. Otherwise, any old step will do if you have no vision for where you want to go. So we've talked, we've talked business plan. We've talked your revenue plan, which is more or less a component of your business plan. We've talked about your sales and salespeople plan. And now we're talking about your personal income plan. These big 4 here, these, these make up what your overall vision must be for your business. Now in future episodes, we could talk around what your investing plan could look like, the questions that you should be asking yourself, as well as your tax plan, and even your health and life plans. But today I want to focus on those 4 as they're derived from, from your business and your business, business's success supports your own personal financial success. Let's start there. Now, many of you are way ahead on this. You've already gone through the planning process, to which I'd say, great. What did today's episode make you think about? Or what must you go revisit Given the conversations we had today, and if planning is new to you, great. As you, as you, you know, stop listening today to today's episode and you're going to go take action, where do you start? What will your planning look like? At a very minimum, I would encourage you to block some time, maybe even a day, and just sit in front of a whiteboard and map these, these 4 plans out. That's all I have for you today. The No Days Off Podcast. Thank you so much for listening. And remember, every single day brings a new opportunity to get better. So let's get after it.