I often am asked the question, “What kind of business should I start or buy?” Here’s what I have to say about it. When working with our clients on small business coaching, it’s essential to make this critical decision.
It’s almost cliche because we’ve heard it so many times. “Fail to plan. Plan to fail.” When I meet entrepreneurs and professionals I am always curious to know what they want for their business. The most common answer is, “I want to grow my business. More sales. More clients. More income.” Or some variation of this.
When I ask them if they are interested in sharing their business plan with me I often get a blank stare. As if to say, “What plan?”
Business planning doesn’t have to be a long and painful process. But planning is a discipline that no serious entrepreneur will overlook.
There are three types of business plans we use to help clients grow their businesses.
1. Marketing and Sales Action Plan-This plan is just what it says it is. It addresses positioning, an assessment of the current state of affairs, and specific goals, objectives, action steps, dates and people to be held accountable for following through. The Marketing and Sales Action Plan is typically for internal use only.
2. Strategic Plan. This is typically for internal use only as well. But the strategic plan goes far beyond marketing and sales. It should address the organizations vision, mission, values/commitments, goals, objectives, action steps, dates and people to be held accountable for following through. This is an essential plan for organizations committed to growth. It should include the entire team if possible. At a minimum, the key people on the team.
3. The Professional Business Plan. I call it this because this is the type of plan that is used for raising capital with banks and private investors. It is typically a professionally written plan that addresses every aspect of the business including the business model, management team, marketing plan, competition analysis, market analysis, financial statements, disclosures, etc. Your assumptions and details of the plan must be as accurate as possible. And it should be finished and presented in the most professional way possible.
In dealing with many angel and private investors over the years, I’ve found that many people want a simple, one page business plan that summarizes the key points of your business. I haven’t detailed this type of plan because the content is essentially that of the third plan I listed, but done in a summary format to fit on one or two pages at the most.
Having a written plan that is created with and reviewed at least monthly by you and your key players is essential. It is one of the most overlooked disciplines I see. If you don’t have a plan, get serious about blocking time and putting one in writing. Again, it doesn’t have to be fancy if you’re using it for internal purposes. Pick the type of plan based on how you’re going to use it as listed above.
So what kind of plan do you have in place? How often do you review it? How has planning made a difference in your business?
We welcome your comments and suggestions.
Clifford Jones, Founder
WealthNet Partners, LLC
“Discover The Art of Business Development”
Scottsdale, Arizona
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When I meet entrepreneurs for the first time, the most important question I ask is, “What do you want for yourself and your business?” In almost every instance I hear, “More sales, revenue, profit, etc.”
This is when I ask the prospective client if we can review their business plan. Then comes the blank stare and, “Well, uh. Gee. I don’t really have one.”
The truth is most business owners have a plan. The problem usually is that it resides in their head or on a cocktail napkin tucked in the top drawer of their desk. Which doesn’t do their organization or them much good at all.
At WealthNet, we help our clients craft two types of business plans. Strategic plans are crafted for internal use to help guide the organization in a consistent and disciplined fashion. The typical Strategic Plan includes Vision, Mission, Objectives, Action Steps, Business and Competition Analysis, and a time line which includes the people who are responsible for completing each of the Action Steps. It is a living, breathing document that is crafted with the help of a WealthNet facilitator and engages virtually everyone in the organization to help craft and execute the plan.
The other type of business plan is used for external purposes suck as securing debt or equity financing. Typically, this type business plan is a very detailed plan that includes an Executive/Business Summary, Customer/Client Profile, Description of Products/Services, Target Market, Sales/Marketing Strategy, Business Model, Financial Analysis and Projections, Competition Analysis, and your Competitive Advantage. This type of plan will include but is not limited to this list and should require some level of professional assistance since it will be shared with bankers, investors, venture capitalists, angels, etc. It must be well thought out and written. And it must read and look like a professional plan.
If you would like to understand more about which plan is most suitable for your business and how it can impact the success of your company, contact us today.
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