Planning for 2020

By Brian Griffin
Summer is coming to a close. Regardless of whether your business is seasonal, early autumn can be a good time to review your performance to date, as well as set the projections for the year ahead. But what should you take into account, especially in this climate, in order to ensure you’re positioning your business on solid footing? Here are three things I’ve learned working in commercial banking that have continued to be timeless advice year over year.
Continue to update your cash flow plan
Having a clear plan will enable you to better manage your cash flow. It’s important to make sure you have time to revisit this plan each year as your business will likely grow and change with each new season. A way to simplify cash flow planning is thinking about it in three buckets: short-term spending, mid-term spending and long-term spending. These buckets can help you properly allocate resources for each full year.
Short-Term: The short-term bucket is for cash that has an immediate purpose, such as funds for payroll.
Mid-term: Your middle bucket is where you want to grow your money but have it accessible in case you need it for unexpected developments. Growing this middle bucket allows you to transfer money to the short-term bucket if you need it quickly, or move some into the third bucket for long-term planning and spending. This middle bucket can help ensure you have enough to cover events that you didn’t anticipate.
Long-term: The long-term bucket is for cash that you can grow long term to be invested in future projects that will benefit your business down the road.
 The economy will always change
As a business owner, it’s important to have one eye on interest rates and the other on your banking accounts. This way you can anticipate how an increase or decrease will affect your business plan. It’s equally important to have a close network of advisors to make sure you’re reading the signs correctly.
It can be worrisome to think about changes in the economy as changes are not always predictable. Business growth and planning is a long-term strategy, and having patience as well as a network of trusted advisors will not only benefit your mental state, but also your company.
 Think long-term
It is so important to think about the day-to-day of your business. Your cash flow projections and safety nets should always be adjusted based off of the growth of your business and the success you’ve seen for the year. But keep in mind that the decisions you make now, often have long-term effects.
One example I’ve seen on a number of occasions is renting versus buying your space. Where your business is located can have a big impact on its success but just as important is whether you own or lease your space. This is especially important as you think about long-term goals. If you ever look to sell your business for example, what will be the value if you lease versus if you own your location?
If you’re looking for insight, your banker should be a helpful resource both in times of transition, and in general. Once you find someone you trust, make sure you’re able to connect with them on what you feel you’re doing well, and what concerns you have. If you think something is trending in the wrong direction, it’s best to have that conversation together and find a solution. In essence, that’s what your bank should be there for, advice and support so that your business can continue to grow based upon your strategies.
Brian Griffin is Senior Vice President of Commercial Lending at Rockland Trust. He can be reached at 508-771-5540 or Brian.Griffin@