Why write a business plan? Mapping the new world.

“Fail to Plan, Plan to Fail”.  Advice that seems too slick and irrelevant when you are planning a new business.  The excitement of your idea is overwhelming, you know you’ve hit a winner, so why get bogged down in writing a plan?  Small businesses are reactive and cutting edge, aren’t they – and no-one knows what lies ahead.  But as soon as you start dealing with banks and professionals, a business plan is the first thing they ask for.  How do you go about writing yours?

You are an explorer in an unknown world.  Start with what you know, and what you think may happen.  Keep checking that map to see if it is accurate – and change and update it regularly.  Christopher Columbus wanted to discover a route to the Indies by sailing west from Spain.  He had to have a clear plan and goals to secure royal backing and launch the expedition.  When he found land in the ‘West Indies’, he may not have achieved the original goal – but he succeeded tenfold by following the plan.

So where do you start with your own map?

Think about yourself first: it’s amazing how many people fail to do this.

• What do you want to achieve for your own life?
• Are you balancing family commitments, or are you ready to work all hours?
• Do you have the support of your closest family and friends?  The first few months and years will be harder than you think.
• How much do you need to earn to survive and to flourish?

Define what your business will do:

• What are you going to supply?  Make this simple: key services, key products.
• Who are your customers?
• How are you going to reach your customers? Networking, advertising,  online profile, physical presence.
• What investment is needed to start off?  Buying stock, creating your brand, and setting up a professional internet profile are things that you will normally have to finance yourself.

Look clearly at your capabilities:

• Define your strengths and weaknesses honestly.  Play to your strengths, and understand and manage your weaknesses.
• What are the opportunities for your business – and what are the threats?  You won’t know what is to come, but careful research and honest reflection will help you handle whatever is thrown at you.

Put some numbers together:

• Set your prices and volumes realistically so you can earn a living and compete in the marketplace.
• Once you have a set of figures, work out what happens if the sales halve (can you survive?) or double (can you cope?).

Define key actions:

• Decide what you have to do each day, each week, or each month to be successful.
• In a month how many sales do you need?
• How many quotes need to be written, or clients need to be contacted, or services need to be delivered each week?
• What do you do today to start the process?

Now, start doing it!  Today is the first step on your road to success.