The Grapevine

Wine Shop Business Planning: Short-Term and Long-Term

May 21st, 2013

Wine shop owners, like any good business owners, need to think both short-term and long. You have to in order to survive. When that thinking gets out of balance, it’s typically heavy on short-term thinking at the expense of the long-term plan. Here are a few ways to fight against that common impulse. [level-members]

To cite an extreme example, as quarterly tax time rolls around, we’ve seen shops who run a “blow it out the door” promotion to get cash coming in to meet tax obligations. If they’re selling below their cost to raise the cash, it’s not short-term planning; it’s short sighted …)

But if you need the cash, what can you do? For starters, you can plan ahead. Better long-term planning would help you stay out of that trap by setting aside the taxes owed as you went along.

Yes, I know there are slow months and times when it’s hard to stick to a plan like that. But your choice is to suffer through that boom-and-bust cycle over and over or, wait for it, plan your way around it.

As in, plan a post-holiday promotion to help boost sales in a traditionally slow period. Or use a portion of your high-period income to increase stock so that during your slow period, you won’t have to make any more than the most minimal outlays to restock.

Go against the grain. When your competitors are hunkering down for a long, slow winter, gear up to get people excited and into your shop.

In short, stop ignoring the patterns you see and start doing more than hoping for the best. 

Next week we’ll take this idea of long-term planning a bit further. Here’s your homework: who do you think your most important customer is? I’m willing to bet 99% of you are wrong about who that customer is.  [/level-members]