You will hear a lot of pros and cons concerning spending the time to create a full business plan. Many will say it is not necessary to do all of the research and create all of the tables etc. Others will tell you that it is necessary, especially, if you intend to apply for a loan or grant to support your small business. The truth is you should do everything and then all you need do is update the tables and verbiage to correspond with requirements for applying for a loan or grant. Yes, creating a Business Plan does involve some work, if this bothers you…don’t give up your day job!
What I found was the creation of the business plan made me think about many necessities that would lead us to be successful in our niche that I had not recognized before. It, also, made me think of things purely related to doing business in general I had not thought of. Your business plan provides you with tools to track your progress from day one, month by month and year to year. If you think how much money you will make is all you need to track, you’re wrong and I sincerely hope you realize this before the bills start coming in.
If you are just starting to think of launching a small business, start your business plan now, especially if this is your first venture. It will take a few weeks to complete and it is worth it. If you are not willing to put forth this effort, you are not going to succeed with your business…period! There is a lot of research required that establishes what your particular market segment is doing, who your competitors will be, what your competitors charge and where your competitors are located. Taking a close look at who my competitors were allowed me to realize a number of services I could and should offer to remain competitive and increase sales. The research, also, helped me set what to charge for these services to be competitive without appearing to be just “cheap.” If your competitors have been around for awhile, they have realized how much to charge for their services or products to not just stay in business, but to make a profit. I do hope you intend to make a profit.
Your business plan establishes your model, identifies your market sector, establishes your sales expectations, tracks your results in sales versus profits, and establishes your expenditures and income requirements to pay those expenditures and to make a profit. The most important benefit is that it does make you think. This is why you should make your business plan prior to launching your business, if you can be honest with yourself while preparing it you may find your business is not viable or you may need to expand your services or products to achieve the goals you set for near and long term success. Of course, the key is being able to be honest with yourself and keep your expectations within realistic limits. You want to do better than or very close to your projections, not a whole lot worse. If you’re thinking, “this guy is crazy, how is it possible to project how much I will make?” then you should either not go into business or keep voting that same straight Democrat ticket this November and hope for a bailout! The rest of us will applaud you for the first choice and I for one will not support you for the latter.
A business plan is another one of those things you can pay to have done for you, but I suggest you do it yourself. Only you can be truly honest about your expectations and goals. However, an outsider can be brutally honest about your market sector and the chances for success without being influenced by “pie in the sky.” Unless you can be completely honest about your chances for success and failure you will not last and or be able to grow your business.
There are a number of business plan templates available for sale and for free. The ones for sale do some of the work for you, but you may find them difficult to change to meet your needs. If you are going to apply for a loan or grant you should make the business plan as much yours as possible. A plan that appears to be a straight template does not carry as much weight as one appearing to be tailored to your business. You need to remember you are selling yourself and your company to obtain the loan or grant. You may have to participate in an interview as part of the process and if you are not familiar with the document you have produced it may be construed you are not sincere in putting forth the effort and therefore not a good risk. Microsoft Office WORD contains a good template for creating a business plan. The template is easily customizable and contains enough direction as to setting it up and what it should contain. The tables you will need to flesh out the business plan can be found in WORD or EXCEL templates, and just remember to customize them for a professional appearance. As with any company document, you should have someone proof the completed business plan. This should be someone you trust to do a good job and who is not afraid to offer suggestions and or corrections to you. You should, also, repay them with a good lunch or dinner as this is no quick read.
Once completed, remember to keep your “friend” handy and update the tables regularly so you can track how your business is doing and how well you projected your progress would be. All of this can and should be a fun and rewarding experience!
Next time: “To be social or not to be social…that is the question.”