A point that was repeated to me while I was in the Army was ?when you fail to plan; you plan to fail.? This holds true through all aspects of life ? especially in business. Knowing this, you need to create and maintain a thorough plan for your business. This is where we at LCT can help you. LCT is one of the few publications in the world that extensively surveys the industry it serves and publishes the findings. So, why do we do it? Well, we do it for you. We want our readers, the limousine, sedan and bus operators, to use the information that we gather for their business planning and goal setting. Because our goal is to keep you in business and help you become more successful. So, can wealth be achieved in this economy? The answer is yes, but you have to be business-smart, and able to adjust. You need to set a (realistic) financial goal for your company, and then put a plan together on how to get there.
Before you set up your plan, you must fully understand your present operating costs. If you don?t keep an accounting ledger, look at your checkbook ? deposits are income, checks written are expenses. I know, it?s a simplified example, but realistically, that?s all it is. Look at the national averages that we have compiled in this issue. Compare your company to these numbers, and let that be a guide for you in your planning.
For example, let?s say that the cost to run your service was $135,800. In order for you to break even you would have to charge $54 an hour and generate 2,515 annual hours. That breaks down to 210 hours per month or 48.4 hours per week. With three vehicles, that?s an average of 17.5 hours per week per vehicle. I?m not a mathematician, but it?s easy to understand if you work at it. This now gives you an idea of where you need to be.
So, once you?ve added up your expenses and you fully understand your break-even point, you can begin building your financial plan. Then you can set your strategy in motion.
If you already have a plan established, good for you! You?re already ahead of the game. However, as your business grows and the economy ebbs and flows, you need to constantly adjust your plan. Your goals from five years ago are not necessarily the same as the ones you have now. The statistical information in this issue can help you adjust and keep your plan and your goals current.
A lot of hard work and research went into the compiling this information for you. So go forth and use it.