Do you have a business plan?
Go on, be honest. Lots of people start a business without working on a business plan. After all, why spend hours on a document no one’s going to see when there are so many other tasks that take priority? And if you do have one – when was the last time you reviewed and updated it? Yes, really. You didn’t think you could just write your business plan then forget about it, did you?
Think of your business plan as creating a recipe for success
If you want your business to be successful then you need to know what that success looks like, and how you’re going to get there. It’s like someone asking you to make an amazing cake – what does the cake look like and how are you going to make it? Usually, you’d find a recipe for the particular cake you want to make that lists all the ingredients you need, and breaks the process down into easy to follow steps that when followed correctly lead to an amazing creation.
The problem is, there are no online recipes on how to make your particular business successful. So you need to sit down and plan it all – your strengths, skills, assets, etc are the ingredients, so how are you going to pull it all together and create your vision?
A business plan is your personal recipe – turning your skills and strengths into a successful business
A well-researched and written business plan not only focuses your mind on what you need to do, and the challenges you’ll need to overcome – it also prompts confidence in your business from bank managers, lenders, investors, etc. Essential if you want your business to grow!
So how do you go about creating a business plan?
I would always recommend you follow a template as it will pose the questions you might not have considered and ensure you cover all the bases. Although aimed at young entrepreneurs, The Prince’s Trust has some great guides and templates for business plans here (https://www.princes-trust.org.uk/help-for-young-people/tools-resources/business-tools/business-plans).
Generally, your business plan should have sections on:
Your business summary – your vision for the business. What do you want your successful business to look like and achieve?
Your background – what are your skills and strengths? What experience do you have that will help you manage a successful business?
Products and services – what are you going to sell? Are you planning on introducing anything further down the line?
The market – who is your ideal customer? How much do you actually know about them? How are you going to sell to them?
Market research – how do you know your product or service will work? Have you held any focus groups or surveys to fine tune what you offer?
Marketing strategy – what are you going to, how much is going to cost and why are you doing it? Try and set SMART goals where you can.
Competitor analysis – doing a SWOT analysis on your competitors can identify their weaknesses helping you discover where you can pitch your business.
Operations and logistics – this is one of the most important sections but often overlooked. How are you going to make your product or deliver your service? What variables could affect your productivity? What terms are your suppliers giving you? Where a business fails it’s often because they haven’t thought about this properly.
Costs and pricing – how much is it going to cost you to run your business? How much profit do you want to make? So how much are you going to charge your customers to achieve that?
Back-up plan – do you have one? What happens if your supplier goes bankrupt? What happens if you end up in hospital? Will your business be able to carry on? A contingency plan is important.
Whilst not essential, the Prince’s Trust business plan template does have an ‘elevator pitch’ section. Networking is so important for businesses and this really does make you focus on how you can sell your business in a minute or less – business name, strapline (an easy to remember strapline makes your business memorable) and your pitch – who you are, what you do and why you’re the best at it.
Top tip – reducing your marketing message into an elevator pitch actually helps with social media marketing like Twitter, where ‘to the point’ messages are important.
So obviously, there is a lot to think about and plan for. Be honest, is there anything in there that you’d never have thought to put in your business plan?
A business plan is only effective if it is regularly reviewed and updated
Like mentioned at the beginning of this blog, a lot of people will write a business plan to satisfy their bank manager then leave it untouched for years to come. A business plan is a valuable tool that will help you keep track of progress, identify what you could be doing better and plan how you’re going to implement those change – keeping you accountable. A yearly review is essential, why not time it for a special date – like the first sale you made, or positive review received? You’ll remember what you did to achieve that and it’ll push you to achieve more!