The New Year is only five weeks away! Today is a great day to review your business plan for 2013. And if you don’t have a business plan, today is a great day to start one. So, why is a written business plan important? And, what are the essential areas that you should make sure are in your business plan?
Written business plans are good because they give you, the owner of a small business, the chance to sit down and really think about your business. When writing a business plan, you have to think about a lot of areas of your business. What kind of growth plan do you have in mind? What kind of financials do you currently have? Are you going to need loans or other capital infusions? Are you going to be moving into a new space? Hiring employees? Where has your business come from? Have you met your financial and other goals since you have started? If not, why not? All of these are important questions to ask and answer. When you sit down for a few hours to focus on your business plan, you can take the time to invest in your business to make sure it gets to where you want it to be.
When you are preparing a business plan, you don’t need to pay someone thousands of dollars to help you. You can start with the business plan available on SCORE’s website and get the basics. Even if you are looking for financing and need a more formal business plan in order to secure money, you can find many free or low cost resources to help. If you need any, please call or email me.
The essential parts of a business plan will be your vision for the business, financial status, your marketing plan, and your goals for the future. Your vision statement will include what your business does, who your target customer is, and how you are a different from the competition. If you have been in business for several years, you may have a clear idea of this. If you are new to business, you can take time to determine how you are going to position yourself.
Your financial status will include your past information (if in business) and your future projections. Again, if you are currently in business, doing this may be easier than if you are just starting. Either way, you want to make sure you have three different scenarios you are working with – best case, worst case, and most realistic. Your best case, while still being in the realm of realistic possibilities, should forecast your sales if everything goes according to plan. While this rarely happens, it gives you a goal to shoot for. Your most realistic plan should account for some issues coming up such as bad weather during busy sales times leading to lower sales, issues with employees, higher than anticipated expenses, and other issues. This lets you know what is a realistic financial goal for you to reach. Finally, and hopefully this will not happen to you, you will want to plan for the worst. What are your financials going to be if everything goes wrong? How are you going to cope with this situation? By being prepared, it helps ensure your business can overcome difficult times.
Your marketing plan can be an essential part of your business. In fact, some business schools are moving away from having a formal business plan writing requirement and going only to a marketing plan requirement. Marketing plans help you determine how you are going to find customers – something that is essential for every business from business attorneys like myself to plumbers to coffee shops. If you don’t have clients, you can’t make money (well, most of the time). You will want to plot out what you are going to do for both online and offline marketing and how you are going to get your services in front of those target markets listed in your vision statement.
Finally, you want to think about growth. Where do you want to be next year this time? Two years from now? Five? Ten? You have to plan on how you are going to reach this growth. Are you going to grow slowly for several years and try to grow larger later (for example, if, like me, you started a business when your kids where young and want to wait to expand with employees until they are in school)? Do you want to grow quickly and then scale back later (for example, if you are wanting to retire in 20 years, you may want to grow now and scale back to part time then)? Do you want to hire employees? Or think you will need to? All of these are things to be thinking about.
As you write your business plan, be thinking about the services you will need this upcoming year. Financial, legal and tax services can cost money and should be planned for. If you need any help with your legal services, or determining what services you should be planning for, make sure to call me, your small business attorney, at 720-258-6647 or email me today!