This is the second of a six part series of articles from two ELT professionals who have successfully done just that: Mike Hogan and Bethany Cagnol. Here, they share advice on producing a business plan, goal-setting, and planning actions to achieve them.
As a freelancer you are a business, albeit a one-person business, but you still need a plan. It doesn’t have to be a formalised plan, but a simple overview of your finances, your goals, and how you plan to achieve them. This process can help keep you on track and stay focused.
The first step in writing a business plan is often carrying out a basic financial analysis of your current situation. It can be very helpful to create a spreadsheet (e.g. Excel) with all of your regular expenses, broken into columns representing weekly, monthly and yearly expenses. For example, on the left-hand side, put:
Fixed expenditure: Rent or mortgage payments, car insurance, public transport card, gym or association membership, phone bills etc.
Variable expenditure: Estimates of items such as food, clothing, entertainment, etc.
Sundry items: Regular savings, donations, a new computer, further training, and an emergency fund you can dip into in case you have a few quiet weeks or months.
Add up the columns and divide by ten to give you an idea of the monthly income needed to sustain your current lifestyle. Why ten rather than twelve?
a) There will always be quiet months
b) You may need a few sick days
c) Everyone deserves a holiday!
In another column on the right, type your expected, realistic, monthly income and review it every 14 days or so to check that you are still on track with relation to the expenses listed on the left. As your income grows you can increase your expenditure, or conversely, if your expenditure grows you’ll either need to earn more, or cut back on spending.
Once you have an overview of your financial standing, move on to evaluating your short-, medium- and long-term goals. Creating SMART goals can help you stay on track; these are Specific, Measureable, Achievable, Realistic and Timely. As with your finances, goals need to be realistic and defined; avoid statements such as “I’d like more clients.” or “I want to work less for language schools.” Set quantifiable targets: “I want to get three new clients by the end of this year.” or “I’d like to increase my income by 10% / reduce my working hours by 10%.” Once you’ve set realistic targets you can then focus on any investment in marketing, further training, quality control, etc. in order to reach those targets.
A SWOT Analysis
Whether you are teaching, editing, translating or doing other ELT-related work, we suggest you carry out a SWOT analysis on yourself and the services you provide. A SWOT analysis looks at the Strengths, Weaknesses, Opportunities and Threats associated with a proposed course of action, project or plan.
Your strengths are the areas in which you excel as an ELT professional. Strengths can be skills and services that are exclusive to your business, that no one else can provide. Use this differentiation to your advantage.
Keep a close eye on your weaknesses. Don’t worry, we all have them! But don’t take on tasks you aren’t fully capable of carrying out or services for which you aren’t qualified. Doing so might get you that first contract, but probably not the second; and it certainly won’t help your reputation.
In order to identify the opportunities, you’ll need to do some market research. Find out what your potential clients are looking for and what your competitors are offering. Keep your eyes and ears open so that you don’t miss opportunities. If you focus on your strengths, opportunities will find you, so be ready!
And finally, as Lao Tzu wrote in the Art of War, “If you know yourself and know your enemy you can win a hundred battles without a single loss.” Know your threats. When assessing your competitors, don’t concentrate on taking their business or being better than them. It’s healthier and more beneficial to think about how you can differentiate yourself from companies offering similar services to yours. You can do this in a number of ways: price, quality, and simple things such as reliability and professionalism. Be prepared to lose a client every now and then through no fault of your own and have the financial safety net set up to catch you.
Further to your financial plan and SWOT analysis you should also create a checklist to:
- Define your customer (even if this is a language school)
- Define your services
- Define your added value
- Conduct market research into potential clients and competitors
In the next article in this series we’ll look at implementation and how to put your plan into practice with a clear sales and marketing strategy.
This article first appeared in the November 2013 edition of the Teaching Adults Newsletter – a round-up of news, interviews and resources specifically for teachers of adults. If you teach adults, subscribe to the Teaching Adults Newsletter now.
© Mike Hogan and Bethany Cagnol, 2014. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to the authors with appropriate and specific direction to the original content.