Planning for Success
Here is a conversation that’s conducted between business owners and their friends and acquaintances every day.
After you “listen” to this visit, we’ll talk about how to turn this conversation into an important management tool.
Friend: “Hi Joe. Heard you’re starting a new business. What kind?”
Owner: “Oh. Hi, Jim. Yeah, John and I am going to be selling square widgets to round widget distributors.”
Friend: “How’re you going to do that?”
Owner “We found out that no one has thought to offer square widgets to these guys. We asked around, and it looks like they not only need square widgets, buy they will pay a premium for them.”
Friend: “Sounds good. Where are you going to get your square widgets?”
Owner: “Well, we discovered that the round widget guys don’t need first quality square widgets, so we’re buying seconds, cleaning them up, repackaging them, and delivering them to those customers.”
Friend: “Sounds like you’ve found a niche. How many can you sell in a year?”
Owner: “We’ve identified the need for 15,000 this year, and with the trend in the market, we think we can double that within three years. Gotta go. See ya later.”
Saying your business plan
Now, let’s look at what just happened.
In this two-minute conversation, the owner identified his business, management team, industry, business focus, market niche, customer profile, vendor profile, pricing strategy, market research results, and finally, his growth plans.
Probably without realizing it, “Joe” actually said his business plan.
His half of this conversation is the essence of a business plan. All that’s left is to add a few other elements, plus the narrative and numbers.
And since you’re having these conversations, too, that means you’re saying your business plan – also probably without realizing it.
So, we know you’re saying your plan, but are you getting it on paper so you can use it?
And if you’re asking why you need a business plan, here are the three best answers:
- To get a business loan.
- To attract investors.
- Because it’s an essential management tool.
Don’t make these mistakes
- Don’t wait until you need a business plan to start one.
- Don’t wait until you have time.
- Don’t make it harder than it has to be.
You can’t eat fruit from a tree that was never planted, and you can’t manage with a business plan that was never started. The first words of your plan are the seeds from which you will grow your business plan. So, just start writing what you already know, like “Joe’s” conversation.
Two final points: There are computer programs that will help you produce your plan for under $100; but first, check out the free examples of business plans at bplans.com.
Write this on a rock... A written business plan will help you achieve new levels of management professionalism.
Jim Blasingame
Small Business Expert and host of The Small Business Advocate Show
©2008 All Rights Reserved
