“One must desire something to be alive.” -Margaret DelandAs human beings we have the amazing ability to dream. We hope, we strive to be better, and we work towards goals that will enable us to have a better life for ourselves and those we love.
Where would we be if we wanted nothing? What would life be for? It seems that those few unlucky souls who do not want anything are just sleepwalking through life, and chances are if you’re reading this book then you’re not in that minority. Yes, you want something. Yes, you have dreams. And yes, you’re willing to risk all to try and make them come true. It’s the human spirit at its best.
Although this book is about writing up your business plan, as we said before, we’re not starting in the “traditional” way. If we were we’d be jumping into things like your business summary and market strategies. That stuff, although it’s important too, will come later.
Right now we need to start off talking about your dreams. Why? Because that’s what’s truly driving you to do this. If you didn’t have a dream, would you be willing to put your finances on the line like this? Your reputation? Would you be willing to risk it all on this belief of yours that you can do this better than it’s being done right now?
So we need to start by writing down exactly why you’re doing this. Now, don’t be lazy here and say you want to make big bucks so you can retire in ten years and leave it at that. Although making money is a great goal, we need to be more specific.
Why do you want to make money? When you picture your life as a successful business owner, what do you see? Do you want to move to an island in the Caribbean and spend your days on the beach in the sun? Do you want to buy a house in the country and start a hobby farm? Do you want to tour the country on your Harley? Donate extensively to your favorite charities? Imagine your dream life, the one that you want to happen as a result of your successful business, and start writing it down.
What is it that you most want to get out of your business, and how do you want to feel? Powerful? Successful? Free? Joyful? Why do you want to feel this way? Really take some time here and think about this. These questions are at the heart of why you’re doing this, and defining them clearly will be the entire backbone of your business plan (and your business itself!). This is your motivation, no matter how subconscious it is, and you need to know what’s driving you.
Now that you’ve looked closely at what you want from your business, take a minute to consider the people around you. Not just your family, but your employees and your customers as well. How do you want them to feel about your business? What do you want them to get out of the experience of working or buying from you?
Again, don’t just write something down like “It’d be great to have the opportunity to provide someone with a job, and a product to my customers that they like.”
Get specific, and put your imagination to work! Really spend some time thinking about the kind of impact your business will have on people. Yes, you’re giving people a job. But do they love coming to work? Is there a feeling of teamwork and excitement about what they’re doing? Do you want your office or company to have a family-like atmosphere? What about your customers, do they respect your company or brand? Do they feel that you’re running the business with honesty and integrity, to the highest standards?
It’s important to realize that other people will be depending on you in this venture. Your family, your employees, and your customers are all part of the equation. Write down your dreams and goals for them just as you did with your own. If you need any help with creating your Dream Sheet, head over to our Resource section for a helpful worksheet to get you started.
Ok, by now you’re probably looking at a page full of the things that are closest to your heart. Excellent. Now, what do we do with it?
Well, right now we’re going to lay it aside. Our “Dream Sheet”, if you want to call it that, is just one puzzle piece among many that is going to make up our business plan. Granted, it’s probably the most important, but we’ve still got to dig up everything else we’re going to need to start constructing your plan.
Ok, this is going to be fun. What we’re going to do now is make a big pile of some of the stuff you’re going to put in your business plan. Don’t roll your eyes- we’re not going to make you run statistics or calculate tax payments just yet. What we need to do is to create your brag pile. You know, all that stuff that you’ve done that has netted you some “kudos”. The stuff that makes your chest swell with pride and enables you to strut around a bit when you think of all the great things you’ve done.
If you’ve created a brochure for your current or future business, throw that in there. If you had some newspaper articles written about you or your business, put those in. If you’ve gotten some glowing testimonials from co-workers or clients, add those to the pile. Have a customer database? Put that in. If you’re pursuing financing from someone, be it a bank, family member, or angel investor, then this “bragging pile” is what is going to put you in a good light. Make it as big as you can. Now is not the time to be modest!
Need help wondering what to put in here? Again, head over to the Resource section for a worksheet to get your imagination flowing.
You’re also going to need some financial information. You’ll need to write down all your assets and liabilities, and include your tax statements from at least the last three years. Start digging up this paperwork, because you’ll need it.
Although we’re going to go into the financials in much more detail later on, it will be helpful if you start now creating two spreadsheets: one will be a detailed list of what you expect your start-up costs to be, and the other will be an estimation of your monthly operating budget.
For a detailed list of things to consider for both these lists, see Chapter 2: Financials. Writing this out beforehand might save you some time down the road!
Now, before we actually start writing your plan we’re going to create an outline. Remember those research papers you had to write in college? Remember how much you hated writing the outline (and when you actually began the paper, how grateful you were that you had one?). Well, don’t groan but you really need to write one up. It will help you understand everything you’re going to need for your plan and it will keep you focused when you roll up your sleeves and actually start writing it.
It will also take away some of the fear you might be feeling on writing a business plan. Your outline will give you a system to work off of, and we’ll start off with just the main points you’ll need to cover.
Don’t worry, we’ll be going into each of these topics in more detail in the next chapter.
Think of your outline like building a house- the frame goes up first, and then everything else gets piled on top after that. Remember, this is just an outline. There’s no need to write a novel (yet); just jot down a few sentences and key points for each topic to guide you later on.• Executive Summary- This is written last, although it will be the first thing that is read. This will about one page long and just give an overview of your business, the service or product you’re providing, and why people will want to buy it. • Business Development/Growth- This section of your plan is going to expand on your Executive summary. It’s going to detail your schedule for growth, your industry, opportunity, etc. • Corporate Plan- This is where you’re going to define what systems you’re going to use to run your business. What kind of leadership/management goals do you have, what are your personal goals (think about your Dream Sheet!) and how are you going to report all this information to your employees and/or customers? • Market Strategies- What is it that makes you stand out from your competition? Who are your competitors? • Financials- This is where you’re going to put those spreadsheets in. How much of a loan do you need (if you’re applying for one) and what are you going to do with the money? How much do you expect to make with this business? • Client Goals- This section is going to talk about your customers. How are you going to handle customer service? How will you deliver on the promises you make to your clients? • Lead Conversion- How are you going to turn leads into customers? What systems are you going to use to get more customers? How will you report this information to your employees? And that’s it! Not so bad for an outline, right?
“Everything that can be invented has been invented.” – Charles H. Duell, Commissioner, US Office of Patents, 1899.Boy, was he off or what?
There are reams of quotes from people who were just as narrow-minded as Mr. Duell. There’s the classic quote from the record label that turned down the Beatles, predicting the public was already sick of “guitar groups”. There’s the manager who turned down Elvis, telling him he was better off driving a truck than singing. There’s the engineer from Boeing who predicted that there would never be a bigger plane built after the 247 (which only carried 10 people). And then there’s the engineer at IBM who thought, back in 1968, that the microchip probably wouldn’t be of much use for anyone.
Sure, it’s funny now, but our point is this: you can’t predict what the future is going to bring, no matter how sure you are that you’re right. Technology and trends change in an instant. Human nature is always trying to make things better, faster, newer, more appealing, and as a result what we want as consumers is always changing. That’s why we now have cell phones and hydrogen cars and iPods. Things are always in motion, just like a rushing river, and it’s one of the reasons why this world is such a great place to live.
Can you say for certain where you and your business are going to be in five years? Do you know what new technology is going to come out that will benefit your business? Can you predict what new competition you’ll have?
Of course not. No one knows these things, which is why standard business plans don’t usually work. Standard, “head-centered” plans basically follow a 1-2-3 step approach. They don’t account for or encourage change, and as a result they end up at the bottom of a desk drawer somewhere, taking up space.
If you don’t plan for and embrace change then you’re going to stagnate. You must begin this journey with the expectation that things will probably be vastly different five years from now. Do this, and you’ll be ten steps ahead of most of the other new businesses out there.
So, how to do you work change into your plan?
Well, a lot of has to do with your mindset. Don’t look at your plan as if it’s set in stone. Rather, your financials, your systems, your marketing strategies, everything that’s written down is just your idea of how you’re going to start. They’re here to focus your attention, but it doesn’t mean you have to follow each and every step to the letter or the gig’s up. It’s important to realize that just because something’s in your plan doesn’t mean you have to do it, and conversely just because something is not in your plan doesn’t mean you can’t do it.
Our likening of your business plan to a roadmap still holds true. Yes, you can map out your route, but you’re always welcome to take the backroads when it seems more interesting.
Making regular appointments with yourself to reevaluate your plan is a great way to keep it current. Read it over every six months or so and see where you’re standing. Question your assumptions and don’t be afraid to nix things or add things where you see fit. We’ve included a Six Month Review worksheet in the Resource section if you’d like to take a look.
It’s also important to pull out your plan when something big changes with your business. If you’re a small, independent bookstore and one of the big warehouse chains rolls into town well, this would be a great time to pull out your plan and do some evaluating. The same holds true if you get hit with a natural disaster, or win $500,000 in free advertising (don’t you wish?), or discover a new machine that will enable you to double your output.
The point here is that yes, change is going to happen in your business. It’s the only thing you can really depend on. So make sure you’re using your plan to accommodate that change. Expect it, welcome it, and work with it.
This is going to be a fun little exercise that will add even more personality and passion to your business plan.
It’s helpful when doing anything to have reference points that help you track your progress. Just as mile markers help you know how far you’ve come on a road trip, the reference points will help you realize that yes, your business IS growing, and remind you to celebrate the little victories that are coming your way everyday.
Take a few minutes and envision things that you would be very proud of in your business. There are no right or wrong answers here! Here’s a sample list for you to consider:• Finally making enough revenue daily that I can quit my day job • Having enough business to hire a full-time employee • Having t-shirts, pens, and other promotional material made up with my business name and logo on them • Having enough clients to start writing a monthly newsletter • Having enough money and work to start outsourcing tasks to others • Taking my first paid vacation from the business • Making $1,000 per day gross revenue over a monthly period This list can encompass anything that you would like to accomplish along the way with your business. Abandon your preconceptions about what you “should” feel proud of, and put things that you know in your heart would make you want to dance with joy.
Remember, this plan is only going to work if you’re truly honest with yourself about what you want. Don’t put things in there you think you should feel or goals that you think you should aspire to. This won’t do you any good! Look at your heart and listen to that tiny voice that’s whispering from it. This plan is your plan, and it should reflect your passions and interests.