Basic Business Cents
Homework for Starting a Business
Part V-Put it on Paper-Your Business Plan
by Lou Schultz, SCORE counselor
Original publish date 08/2010 (#45)
You may be sick of people telling you that you need to write a business plan. You have already done your homework detailed in the previous articles and are excited about moving forward, so why take your valuable time to write a detailed business plan? It is probably the best investment of your time that you can make.
First and foremost, the business plan is on-going guidance for you. What you need to do from month to month and year to year is detailed in your plan and you can quickly see if you are on target or not. It is useful to test strategies and options.
The business plan is also a good communications tool that can be used with potential investors, employees, suppliers, and even in some cases with potential customers. When I started my business, I sent a copy of my detailed business plan to three people who I respected and asked for their opinions. All reacted in ways I did not expect. Two sent me contracts for business that floored me, but not as much as the response from the third. He sent me a letter stating I would be out of business in two years if I did not heed his advice. He was right, of course, and the business continues after thirty years.
There are various format options that can be used and various software programs that can be used to fill in the blanks. Sample plans can be viewed at www.bplans.com. I prefer to use the templates that can be found at www.score.org and clicking on business plans. There you will find a business plan template for a start-up business and another for an existing business.
The content should include the following sections:
- Executive summary
- Description of the business
- Objectives and strategy
- Business environment
- Operations plan and tactics
- Marketing plan
- Management, organization, and training
- Financial plan
- Action plan and timetable
- Resumes of key individuals
- Capital equipment list
- Worksheets for financial analysis
- List of assumptions made in development of the plan
- Insurance coverage
- Other supporting documents and data
Developing a good business plan will make you a whole lot smarter and increase you chance of success. It will also boost your level of confidence, which is very important to all stakeholders--employees, customers, suppliers, and investors.
It doesn’t make any difference when you write your plan as long as you do it NOW!