Rhonda has written a very helpful and readable book for new entrepreneurs called Business Plan in a Day, Get it done right, get it done fast. She has also written Six-Week Start-Up, Wear Clean Underwear, and What Business Should I Start?
An experienced entrepreneur, Rhonda has started three successful companies, including a small business planning consulting firm. Her experience gives her a strong real life understanding of the challenges facing entrepreneurs.
There is a disclaimer about the promise of getting an effective business plan done in 24 hours… they may not be consecutive! So, if you’re super busy but you know you need to get your plan written quickly, this 150 page book will help you through the process, show you what you absolutely have to do, and give you tips and tricks to help you reach your goals.
If you are looking to get financing from a bank or other lender, you want to approach investors, such as angel investors or venture capitalists, you want to create a new business or expand an existing business, or even report to upper management on your department’s plans, this well thought out book will help you achieve that goal in a timely manner.
Your business plan is a powerful document telling the story of your company. It presents your current position, your vision for the future, and your plans for realizing that vision.
Rhonda explains that a business plan answers the following questions:
1) What is your business idea or what is your existing business?
2) Who are your existing and / or potential customers/clients and what motivates them to buy from you?
3) How will you let your customers / clients know about your business?
4) Who are your competitors and how are you different from them?
5) Is your management team capable of guiding your business to success?
6) What is the long-range future of your business?
7) What is your company’s financial picture? How much money will it cost to run your business and how much money will you make?
So, now that you know the general questions that it will answer, it will be helpful for you to know the general format that most any business plan will need to follow:
1) Executive Summary: Highlights the most important aspects of your business, summarizing key point of your business plan. If you are seeking outside capital, you’ll want to focus on how the net profits will be distributed to your investors, their return on their investment (ROI), and the possible exit strategies for investors.
2) Company Description: Features the basic, factual details about your business.
3) Target Market Description: Identifies the types of people or businesses most likely to be your customers, and explains their needs and wants. This is where most business owners fail to realize just how important the psychology of their ideal client is to the success of their marketing strategies. You’ll want to really REALLY spend a lot of time on developing a psychographic profile (demographic is usually just common sense, but, still takes some homework).
The psychographic profile will be the one document on which all of your marketing and sales strategies will be anchored. The profile of your ideal client/customer will, to put it simply, make or break your business. ALWAYS REMEMBER: You business will succeed or fail based on how accurately and how thoroughly you understand, document, and leverage the psychology of your preferred customer / client.
4) Competitive Analysis: Evaluates other companies offering a similar product or service or filling a similar market need. This is where a very thorough SWOT analysis is necessary. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. You’ll need to do a SWOT on your company as well as each direct competitor and on the general category of indirect competitors.
5) Marketing and Sales Plan: Outlines how EXACTLY you will reach your customers / clients and secure orders or make sales. This is the detailed procedure and use of vendors and capital to initially test and then create a repeatable system to turn “x” amount of money into “x times 2” or more.
6) Operations Plan: Explains how you run your business and the operational factors that may give you an edge over your competition.
7) Management Team: Describes the key people running your business.
8) Development Plan and Milestones: Shows where your business will be in several year’s time, how you will get there, and the milestones you plan to reach along the way.
9) Financials: A set of financial statements showing the current financial status and future financial goals of your company.
Although the Executive Summary appears first in your plan, prepare it last. You’ll find it much easier to put together when you can draw from the highlights of each previously completed section.
You will need a number of documents that will enable you to complete your plan faster. These include:
Surveys and other research about your target customer
Info about your competition, including research from their web sites
Marketing brochures and other marketing materials
Any past internal company planning papers
Past tax returns for existing companies or for the principals of new businesses
Charts depicting operational procedures
Product data sheets
Well… that’s enough for now. Subscribe to this blog to read the next section that addresses the key components of each part of the plan… if you’ve found this post much later than the post date, simply keep reading the next article in this series.
To Your Success,