How to Develop and Implement a Business Plan
What is a business plan?
A business plan is:
- WHAT a business is going to accomplish.
- HOW it is going to accomplish it.
- WHY it is capable of accomplishing what it has stated.
The thought of starting your own company has entered your mind and you now need to figure out the next step. What needs to happen to create this amazing idea into a fantastic way to make money and have a successful business? You need to create a business plan.
Although often seen as an intimidating task, creating a business plan can be a lot of fun. By creating a plan you are imagining the success that you want your company to have. You are essentially building and running the business all in your mind.
For dreamers the hardest part of a business plan is actually making it happen. They have no problem imagining their idea developing into the next Google or becoming the next Facebook. Their struggle is doing the boring daily tasks that are necessary for success.
Here are some tips and suggestions for creating and following through with your business plan.
Why Do I Need a Business Plan?
A business plan shows that you are serious about your venture. It helps you discover where the biggest challenges will be. Often times, after creating a business plan, an entrepreneur will realize that the business is not as likely to succeed as was first assumed. Therefore, by creating a business plan, the entrepreneur can potentially save thousands of dollars that would have been lost by creating a bad business. On the other hand, if the business is a success, the business plan helps the entrepreneur to know what to do each step of the way to keep the business running smoothly.
Developing a Business Plan
There are many aspects to developing a good business plan – thinking and researching about each area will help ensure the success of a new business venture. Make sure you have fun! If the business becomes a success it will end up being your life – entrepreneurs work more hours than anybody else. Therefore, if this business is going to be your life, enjoy it.
Below is a list of the different categories that should comprise a business plan – along with a brief description. Work on each aspect of the plan individually, than bring them together. Each section needs to have individual attention paid to it.
Executive Summary: The executive summary is at the front of the business plan, but written last. The executive summary is a one or two paragraph summary that says motivates potential business partners and investors to read more.
Mission Statement: What is the purpose of your business? What will you do, why will you do it, and who will you do it for? This segment is several sentences that describe why you are in business.
Business Description: Here you will discuss what the business does. If it is a website you will create a detailed plan of the different pages and functionalities. If the business is a restaurant you will discuss the style of food served, how it will be served, where the restaurant will be located, etc. This is where readers of the plan learn what the company actually does – what customers will experience.
Target Market and Industry Profile: Here is where research begins. Determine the audience that will be interested in the businesses product or service and research the industry. When companies make assumptions here, rather than doing research, they often fail because they do not know who wants their product or how to connect with the people that want their product. What demographics (age, gender, class) will be interested in what you have and how many of them will have access to your company?
Competitors and Competitive Edge: Every business has competitors. Who are yours and how will you be able to get a leg up on them? Don’t only think about companies that sell the same product, but also those that sell similar products. For example, if you start a mini-golf course, the arcade, theater, and real golf course can all be competitors (although they can also benefit your business as well). This is where you would look at placing a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis – which is not as scary as it sounds.
Marketing Strategy: How will people discover your business and what will make them want to check it out? No one will accidentally stumble across a website unless it has people talking about it on Facebook, in forums, and throughout articles online and off. Some people might drive by your restaurant and stop in, but what can you do to get the word out there faster? Marketing plans can be 10-20 pages long and cover a wide variety of methods and ideas. However, having all these ideas tied together into one plan that works together is what separates a great marketing strategy from an expensive disaster.
Management Team: Who will be running the organization, handling the money, marketing, working with customers, etc.? In this section of the business plan there would be a description of each core member of the team with their experience and skill sets. Like the bio read about a speaker before he presents, this is where you want to make everyone look as great as possible without lying – the more impressive the team, the easier to gain partners and financing.
Finances: Everything about money goes here. How much will each part of the business cost? How much will you make after one year, two years, and five years? You will want to include a break-even analysis (how much you will have to sell before you start making money), and a financial plan for the best, worst, and most-likely scenarios – allowing everyone to know what will happen financially in each of this situations. This section is especially important for entrepreneurs looking for funding. Investors will want to know how much money and time will need to go into making them more money.
Timeline: How long will it take to open the doors to the store or develop the website? At what point will the business higher employees or purchase an extra vehicle. By creating a timeline of when things will happen, the business owner has a guide book to follow and investors can know how successfully the business is progressing.
Long-Term Plans: The end of the business plan includes strategies for future growth and development. Will this business remain stagnant or will the company continue to grow, franchise, etc.? When a business has a strong long-term plan in place, a company can start making decisions based on the long-term outcome – leading to future success.
Other Additions: many other aspects can be added to a business plan based on the type of business. Are there special legal needs or licenses? A website will need a detailed description of each page and section. Any other relevant information should be added.
Business is Like Football
Business is a lot like football. With each play in football every player knows what they need to do, when they need to do it, and how to compensate for a change in the defense. The more that a team practices plays, the more prepared they will be to overcome any challenges that come their way.
When an entrepreneur and her team develop a strong business plan, it is like practicing plays. Although it does not ensure the success of the business, the business will be far better prepared to handle anything that comes its way. With enough practice, talented players, and a coach that calls good plays, a business will have a good chance of succeeding.
How to Implement a Business Plan
Implementing a business plan is more challenging than creating one. Therefore, if you have a good idea but feel that creating a business plan is too much work, don’t even bother with starting a business. The work involved in making the business a success will be overwhelming.
Just like a football play that has been well rehearsed can be performed easily and effectively, the more detailed and structure the business plan is, the easier it will be to implement. However, starting a business is never easy and an entrepreneur can often get bogged down in monotonous details that take away all of the fun.
To successfully implement a business plan, follow these suggestions:
Manage Your Time: One of the hardest aspects of entrepreneurship is the freedom to work at any time. This can often lead to not working at all. Just because you are at home and don’t have someone telling you what to do doesn’t mean you can watch TV all day, go play golf with the neighbor, or catch up on your household chores. It is essential that you block time specifically for work and you treat it as sacred as if you had a regular job. Don’t compromise it for anything.
Prioritize: Accomplish the most important tasks first. It is easy to provide oneself with a false feeling of accomplishment by doing little projects that really have little to no value overall (organizing your desk, planning what you will do with all the money you are going to make, looking up conferences to attend).
Outsource: Clearly you have to do most of the work yourself when launching a business, but there are some things that should or can be outsourced. Legal projects will likely need a lawyer, some accounting procedures may take all day for you but 15 minutes for an accountant. Even easier, ongoing tasks, such as answering emails and managing social media accounts can be outsourced for very inexpensively. Do the work that you are good at. As much as possible (when affordable) pay others to do what you can’t or would rather not do yourself.
Stay Motivated: You are accomplishing the dream that countless people have but never achieve – working for yourself. Many people will say you can’t do it and it’s not worth your time. That’s wrong. THEY can’t do it and it’s not worth THEIR time. Only you can determine the value of your business. Stay enthused and ponder the reasons you started out in the first place.
You Can Successfully Start a Business
The path to success is not easy and it’s laden with people who have attempted and failed before. Just because someone else failed doesn’t mean that you will. You have insights and experiences that have lead you to where you are now. If you believe in God, you can be confident that he’s provided you with the resume you have for a reason – keep working.
Sometimes an entrepreneur will realize that the business did not succeed. Just because the business fails doesn’t mean the entrepreneur is a failure. In fact, many successful business tycoons fail several times before succeeding. If you can learn from your past failures and not lose heart, you may discover that your previous failures will lead you to your greatest success.
Surround yourself with like-minded people who are able to encourage and motivate you and, regardless of the outcome, you will create a legendary story and be living life to the fullest.
Share your business ideas, successes and failures, and suggestions below. I would love to hear from you!