When is the last time that you reviewed, let alone revised, your business plan? Been a while? This is perfectly fine, assuming nothing has changed since your business started. But that’s an unlikely proposition. The economic and policy changes this year alone are significant enough to merit a fresh look at your business plan, not to mention the adjustments competitors have made, availability of new products and the emergence of new technologies.

A business plan should not be viewed as a requisite document compiled only to satisfy lenders and investors. You likely put some real effort and money into developing it. Shouldn’t you expect to extract some additional value from it too? You can by maintaining the plan on a regular basis.

The most important part of your business plan to regularly review and revise is the market and customer analysis section. Other aspects of your plan, like product line and mission statement, are largely within your control. The wants and needs of your customers and the market surrounding your business, however, are factors that you cannot dictate.

A number of resources are available to help you keep tabs on your customers and market area. The U.S. Bureau of Labor Statistics releases monthly labor force reports for 17 metropolitan areas in Michigan, providing timely information on employment levels in your market area (see last month’s article, “How to Find Economic Data for Your Own Backyard”). The U.S. Census Bureau’s American Community Survey (www.census.gov/acs) is also a good source. It provides population, age, income, education, housing, and other useful information to demonstrate how a market is changing. However, these data are only available for major cities and aren’t the easiest to access and analyze.

For those wanting to simplify the task of regularly updating their market research, there are consultants who specialize in doing just that. Fortunately, this doesn’t always mean breaking the bank. Firms like ours subscribe to the massive databases of demographic and economic data for every census block group (smaller than a ZIP code) in the country. With this data we assemble custom analyses for a business’s exact location and customer market areas. These “market snapshots” include 2010 and 2015 projected data on population by age, household income levels, educational attainment, and consumer spending levels by retail category. We can also incorporate your customer database to identify the markets you are penetrating, and those that present new opportunity.

Just plugging new market and customer data into your business plan, while a nice first step, won’t do much good if you don’t take the time to understand what it all means. Do the data show an increase in renter-occupied housing within a five-minute drive of your location, or a drop in the number of households in upper-income brackets? If so, how can you change your product lineup and advertising strategy to draw in this new breed of customer? Or perhaps the data show customers in your area spend much more, on average, on computer products, but you know for a fact that there isn’t a computer store within 20 miles. This may signal an opportunity to fill a void in the market, capturing local customer spending that now occurs elsewhere because their desired products are not locally available.

As the environment around your business continues to change, be sure that your business plan does, too. The technologies available are making this easier every day; by doing so, you can keep pace with your customers and stay a step ahead of your competition.

		Scott Watkins is a senior consultant and director of the market and industry analysis practice area at Anderson Economic Group, LLC. The firm, with offices in East Lansing and Chicago, provides economic, policy and finance consulting services, including retail market analysis, location analysis, site selection, demographic analysis and business valuations. The website is www.AndersonEconomicGroup.com.