Business Plans?

[Linda]

Hey Guys!

I have a question for you. I am doing research on business plans for my newsletter. I have read everywhere how important a business plan is, mainly to qualify for a loan no matter how small or large the amount is. Have any of you out there done a business plan? Did you do it yourself, or what software or book would you recommend. Or maybe there was a service you used online or off? I was amazed at how detailed business plans are. Any information would be of great help.

Thanks
Linda

[BWelford]

Yes, business plans are certainly necessary if you're asking someone financially inclined to lend you money. They usually are very detailed and there's good discipline in going through all the detailed items to make sure that you've not forgotten any important factors. I've done many in my life and helped many others to write them too.

However if I may express a contrarian position. I've sometimes heard people say something like the following 6 months after completing their business plan. "Well I've been following my business plan, I've done what I said I would do and it's not working." Unfortunately in completing your business plan, you may get so involved in the trees that you don't see the wood. It's very important to have a sound strategy that is highly likely to make money. You must also assume that sales will be slower than you hoped and that any loans from financial agents will come very much more slowly than you would like. I've tried to simplify this thinking in a short acronym, NUB. This means that you've got to get right the following:

N for Niche: the market niche of potential clients who will buy your products or services
U for USP (Unique Selling Proposition): the reason why your offerings are so much better than the competition for people in this Niche.
B is any word relating to cash. That could be Bottom Line, Balance Sheet, Bucks. It could even be 'Back of the Envelope Cash flow projection'.

The B is critical. You've got to know that you can survive long enough and that eventually the business will make you as rich as you want to be.

For those interested you'll find this all spelled out in greater detail in a recent Newsletter, The NUB Of Your Marketing Strategy.

I hope, Linda, this doesn't take your thread too far off direction and is hopefully useful.

[Linda]

Thank you Barry for your thread. It was very helpful and I really enjoyed your article in the newsetter. It has given me lots of ideas.

[bragadocchio]

Hi Linda,

A business plan, and a marketing plan can help. Unfortunately, they are things that get easier to do the more often you do them. I also think that Barry is right in looking at preparing for a business by focusing on putting a good business strategy in place.

The SBA does a decent job of describing both a business plan and a marketing plan here:

http://www.sba.gov/starting_business...ing/basic.html

I'm not sure that they stress enough the idea that it is important to pull those documents out and update them as necessary. And, it can be necessary to be flexible and amend your plan as you come across new information, or if the plan doesn't seem to be working.

[4ndr3w]

Hi Linda,

I'm in the thick of composing our business plan right now. A couple of years ago, I bought a copy of Palo Alto Software's Business Plan Pro, but it seemed so simplistic to me that I returned it. It seemed to me that all of the functionality it offered was available in MS Word and Excel. I also figured that, since I have access to the full text of two business plans of companies that obtained VC backing to start operations, I'd have just the template I needed.

Well, it didn't work out so well that time.

So this time around, I purchased a couple of very good books on preparing plans, and I have an outline and a few pages of the full text started. But now I'm beginning to see the value of BBP, because it integrates the same advice I'm getting from the books into a tool that's compatible with Word and Excel. That now strikes me as a very useful approach, and I am considering a purchase of the up-to-date version of BPP to help me slog through this task.

Does this help at all?

[KenGalo]

It's a strategy.
First we developed our philosophy which states our purpose
Then we created our vision that tells us how we will achieve our purpose
Next we identify our competition and how best to insulate ourselves from them
Finally we show our targets in growth, development and stability.

Just my view.

[thepalmshop]

Interesting thread

Gross Margin ?


Hi, I was tring to calculate gross margin for a business plan, I have about 40 different items I sell, all with different price markups, also the longer a plant sits the more it become worth and the higher the price i sell it for. I guess my question is, do I adverage the markup over the entire range of products?

Thanks

[Success]

I think the business plan is over-rated. I'm not saying you should or should not write one, but don't burn yourself out writing your plan.

When you're just starting out with your business you have some much passion, energy, and excitement. I personally think it's better to use that energy doing other things.

[4ndr3w]

Originally Posted by Success

When you're just starting out with your business you have some much passion, energy, and excitement. I personally think it's better to use that energy doing other things.

I disagree. What if all that passion and energy drive you in entirely the wrong direction, like straight into a brick wall? What if you could have seen the wall before you hit it if you had taken the time to plan? And no one ever got funding for a business on the sole basis of passion and energy, in the absence of a plan.

If you really have the passion for the business, it will certainly withstand the creation of a business plan. If the passion fizzles before your plan is finished, maybe you weren't really all that passionate about the business in the first place.

[bluebreak]

linda, i recently read that the first three pages of your plan should be a summary/ intro and are what v.c.'s look at when considering you for investment. if the first three pages dont act as the proper hook, youre going to have a hard time convincing them later on. good luck.

ps what newsletter are you working on?