Success in business comes as a result of planning. You have to
have a detailed, written plan that shows what the ultimate goal
is, the reason for the goal, and each milestone that must be
passed in order to reach your goal.
A business plan is written definition of, and operational plan
for achieving your goal. You need a complete but
success tool in order to define your basic product, income
objectives and specific operating procedures. YOU HAVE TO HAVE A
BUSINESS PLAN to attract investors, obtain financing and hold
onto the confidence of your creditors, particularly in times of
cash flow shortages-in this instance, the amount of money you
have on hand compared with the expenses that must be met.
Aside from an overall directional policy for the production,
sales effort and profit goals of your product-your basic "travel
guide" to business success-the most important purpose your
business plan will serve, will be the basis or foundation of any
financial proposals you submit. Many entrepreneurs are under the
mistaken impression that a business plan is the same as a
financial proposal, or that a financial proposal constitutes a
business plan. This is just a misunderstanding of the uses of
these two separate and different business success aids.
The business plan is a long range "map" to guide your business
to the goal you've set for it. The plan details the what, why,
where, how and when, of your business-the success planning of
your company.
Your financial proposal is a request for money based upon your
business plan-your business history and objectives.
Understand the differences. They are closely related, but they
are not interchangeable.
Writing and putting together a "winning" business plan takes
study, research and time, so don't try to do it all in just one
or two days.
The easiest way to start with a loose leaf notebook, plenty of
paper, pencils, pencil sharpener, and several erasers. Once you
get your mind "in gear" and begin thinking about your business
plan, "10,000 thoughts and ideas per minute" will begin racing
thru your mind...So, it's a good idea when you aren't actually
working on your business plan, to carry a pocket notebook and jot
down those business ideas as they come to you-ideas for sales
promotion, recruiting distributors, and any other thoughts on how
to operate and/or build your business.
Later, when you're actually working on your business plan, you
can take out this "idea notebook" evaluate your ideas, rework
them, refine them, and integrate them into the overall "big
picture" of your business plan.
The best business plans for even the smallest businesses run 25
to 30 pages or more, so you'll need to "title" each page and
arrange the different aspects of your business plan into
"chapters." The format should pretty much run as follows:
Title Page
Statement of Purpose
Table of Contents
Business Description
Market Analysis
Competition
Business Location
Management
Current Financial Records
Explanation of Plans For Growth
Projected Profit & Loss/Operating Figures
Explanation of Financing for Growth
Documentation
Summary of Business & Outlook for The Future
Listing of Business & personal References
This is a logical organization of the information every
business plan should cover. I'll explain each of these chapters
titles in greater detail, but first, let me elaborate upon the
reasons for proper organization of your business plan.
Having a set of "questions to answer" about your business
forces you to take an objective and critical look at your ideas.
Putting it all down on paper allows you to change, erase and
refine everything to function in the manner of a smoothly oiled
machine. You'll be able to spot weakness and strengthen them
before they develop into major problems. Overall, you'll be
developing an operating manual for your business-a valuable tool
which will keep your business on track, and guide you in the
profitable management of your business.
Because it's your idea, and your business, it's very important
that YOU do the planning. This is YOUR business plan, so YOU
develop it, and put it all down on paper just the way YOU want it
to read. Seek out the advice of other people; talk with, listen
to, and observe, other people running similar businesses; enlist
the advice of your accountant and attorney-but at the bottom
line, don't ever forget it has to be YOUR BUSINESS PLAN!
Remember too, that statistics show the greatest causes of
business failure to be poor management and lack of
planning-without a plan by which to operate, no one can manage;
and without a direction in which to aim its efforts, no business
can attain any real success.
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