01/17/11

Business Plan Simplified

by Melanie Spring, Sisarina (@Sisarina)

True or False: All businesses without a business plan fail.     FALSE.

10 years ago today I started Sisarina. (Yep, now I feel old). It was called E-Spring Works back then & only did websites for local businesses in middle-of-nowhere New York. I started it because, as the webmaster of my college, I got a lot of calls from businesses asking if I could help them with their website. I had no business plan, no idea how much to charge and thought I would just do it for fun for awhile. Obviously that wasn't the case.

20 years ago my mother started a barn-sized used clothing consignment store in the country in Western New York & ran it successfully for 16 years. She sold it and the store is still going strong. 2 years later she wanted to open a boutique consignment store and went through a whole business plan process instead of starting on hope. The business plan gave her so much more insight and by the end, she had a clear perspective of what she should do to make her store a success. Same person, two businesses, two different perspectives.

Many business owners start their business with an idea, a plan in their head, a dream or simply enough faith in themselves that they will succeed. Starting with a business plan can get all of those ideas out of your head and onto paper but many business plans are a daunting 50-100 pages. I'm one of those business owners who never wrote a business plan because they scare me too much. I can write marketing plans all day long but a business plan? No way.

Since so many of the businesses Sisarina works with need a business plan AND marketing plan to get a better idea of what they need to do to achieve success, I've put together a starter business plan based on all the really long ones and am even completing it myself! This will help you get  all of your ideas together so you can start expanding them. It can also help you get a business loan, win government contracts and allow you to make your business official. It's never too late to write one.


BUSINESS PLAN SIMPLIFIED
Download your own Business Plan Simplified (.doc)

NOTE:  Your answers don't have to be in-depth, just answer the questions & don't stress yourself out. You should be able to complete it in a week. Upload it to Google Docs and make it a living document so you can update/change it as you need.

To get started, you should be able to answer the following general questions.

COVER PAGE
Company Name:
Owner:
Address:
Phone:
General Email:
Website:

GENERAL
1. Overall: What is the premise of your business?
2. Industry: What is your industry?
3. Mission statement: 30 words or less
4. Goals: What are your general business goals?
5. Objectives: What are your general business objectives?
6. Business Philosophy: What is important to you in business?
7. Target: Who is your target market? (Note: "everyone" isn't a target. Be specific.)
8. Core competencies: What are your strengths? What do you do best?
9. Legal ownership: Sole proprietor, Partnership, Corporation, LLC & why you selected this.

To move a little deeper, expand on these ideas with these specific questions.

PRODUCTS/SERVICES
1. What are your products or services? Be very specific.
2. Competitive Advantage: How are you better than your competition? What do you provide that they don't?
3. Pricing: What is your pricing structure?

MARKETING PLAN
1. Market Research: Who are your competitors? What do they do? How are they successful?
2. Products/Services: Describe them from your customer's point of view. List most important features & benefits.
3. Target Customer: Who is your target customer? Be specific & fully describe who/what they are.
4. Niche: Define your niche & how you fit into it.
5. Strategy:
a. Promotion: how do you plan to advertise? this includes all graphic design like your website, logo, business cards, signage, office design, etc
b. Promotional Budget: how much will you spend on your methods of advertising?
c. Pricing: how will you set your prices, how do they fit with your competitors?
d. Proposed Location: will you have an office, work from home, how will you meet your clients?
e. Sales: how will you sell your products/services?
6. Sales Forecast: Best guess and worst guess (high & low)

OPERATIONAL PLAN
Note: Some of these may not apply to your business.
1. Production: How will your products or services be produced/completed?
2. Location: Where will your products/services be produced/completed?
3. Costs: What are the costs associated with this?
4. Legal: What insurance, certifications, etc will you need?
5. Personnel: How many employees will you need, what types of employees, how will you find them, how will you pay them, how will you train them, what will their schedules be?
6. Inventory: what kind do you need, how will you keep it, how much lead-time for ordering, how much turnover?
7. Suppliers: who will be your key suppliers?
8. Credit Policy: how will you check your customers credit, what are your terms, what discounts will you offer?
9. AP/AR: How will you manage your Accounts Receivable/Payable

Now move into the final stages & talk about how you will manage the business & finances.

MANAGEMENT PLAN
1. Who will manage the business?
2. Describe your key employees. Define their job descriptions.
3. Advisory: Who will be your - attorney, accountant, insurance agent, banker, consultant, mentor?

FINANCIAL PLAN
1. Personal: Define your personal financial situation.
2. Startup Expenses: Explain how you will get started & how much that will cost. (personal savings, loans, gifts, etc)
3. 12-month Profit & Loss Project: Write down your sales projections for the first (or next) 12 months. Include your costs for doing business and make sure you try to include EVERYTHING, from taxes to toilet paper.
4. 4-year Profit Projection: Where do you see your sales over the first 4 years?
5. Projected Cash Flow: When do you see your business receiving money and paying money?
6. Break-Even Analysis: How much income will you need to break even?

EXECUTIVE SUMMARY
- this should be written last but included in your business plan directly after the cover page
- include everything that you would talk about in a 5-min interview about your business
- be concise, professional and upbeat

 

I would love your feedback. This doesn't include everything but gives you a great starting place. Let me know if you used it or if you plan to. Revisions or changes welcome. Happy planning!


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