EPISODE A3.010 Scenario Planning for Stage IV Growth Plan

RESULTS RADIO..."Let's Grow Together

Introduction
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Show Objectives - The Why
It goes without saying, though I am saying it, that you want the maximum level of growth possible without hitting the Stage IV Failure Point - Destruction of Working Capital.

Based on previous shows, we discussed how to build a scenario spreadsheet so you can change the variables to the impact on different parts of the business. Now we are going to establish the best case given your current configuration and how long to reach full capacity.

Key Issues - Owner Perspective:

1. A model of cause and effect relationships,
2. Work forwards from marketing spend to impact on cash flow - best case,
3. Work backwards from cash flow to marketing spend - realistic case,
4. Plan hyper growth scenario - 40% plus to determine bottlenecks,
5. Plan fast growth scenario - 25-40% to determine bottlenecks

What You Need to Know - The What​​​

• ​EPISODE A6.004 REVIEW STAGE VI PLAN - SCENARIO PLANNING ABOUT THE NEW ROI
• EPISODE A3.009 FINANCIALS FOR THE STAGE IV PLAN

​What You Need to Do​​ - The How

1. Make sure your scenario planning spreadsheet has all of the variables separated from the formulas.
2. Start with known constraints - i.e. the number of people available, and place those into the spreadsheet.
3. If you didn't fix the constraints, how much growth is possible by month (total dollars sold, built, and delivered)?
4. Divide your estimated total capacity by growth per month - how long will it take to maximize the businesses potential?
5. What is your annual growth rate?
6. Change the scenario to 25% growth over the year, where are all of the constraints?
7. What will that require?
8. Change the scenario to 40% growth over the year, where are all of the constraints?
9. What will that require?
10. What is your target growth, how long to reach full potential, what must happen prior to starting aggressive growth?

Shows

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