Business Plans

If you’re thinking about starting a business, or helping an existing one to grow, then you’re probably already aware of the importance of planning. If you want to maximize your income then you really need to make sure that you plan to succeed.

But business planning doesn’t come naturally to all entrepreneurs. You may have some great ideas, but the practicalities involved in writing them all down, carrying out cash-flow forecasts, balance sheets and thinking about potential risks may seem far too daunting.

It might help you to know that there are plenty of people who feel the same way. Fortunately, there are some approaches that you can take that will make things easier. A great move that you can make right now is to find some online business plan software.

The brilliant advantage in making use of web-based planning software is that it makes things so much easier. You will be provided with a range of templates, examples and shortcuts. These will offer you important prompts, helping to ensure that you remember to include all of the most vital information.

They also allow you to see a standard way of setting out your plan structure (template). This is perfect if you’re looking to approach a bank manager, a venture capitalist or other professionals. They’ll be impressed that you’ve produced a document that includes a sound strategy, operation plan, financial projections, performance ratios, business valuation – everything that they need to see. What they may not realize is that you’ve been able to produce such a comprehensive set of data as a result of the online software application that you’ve used.

But a business plan isn’t simply something that should be used to impress a bank manager, or that should be filed away in a dusty cupboard. The best plans are those that are updated regularly, reflecting ongoing changes to the enterprise. They can provide you with the necessary focus to put your ideas into action.

By maintaining your project online, you, and your team members have easy access to it. This means that it will be a set of information that will be integral to your company, rather than something that’s seen as being peripheral.

As a result, your team will be able to constantly add new pieces of information to the project database. If your sales are better than expected, for instance, then you can immediately update your financial projections and see what impact the changing situation will have on the cash-flow or profitability. Such information can quickly prove to be invaluable. You will no longer be relying purely on estimates and hasty calculations.

Having a good business plan in place is all about securing the future of your enterprise. It’s a useful way of helping to ensure that you have a more secure future too. Modern on-line software is one way to make your business planning so much easier and more efficient. Make good use of web-based application for your planning and forecasting needs and you’ll be set for success.

A business plan example is without a doubt the best way to present your dream to “the god of purse strings” AKA your financiers. Your plan needs to be professionally presented so anyone who’s involved can easily read it and clearly understand what it’s all about.

It Can Open Doors!

A well written plan can open the doors that many cannot get through. It can get you places that you would otherwise not get to. Like face to face with prospective venture partners, alliance partners and banks.Your business plan needs to spell out loud & clear to those who are financing you that you have the goods to make it work. Throughout the life of your business, your plan will be your road map to success.

Do I Really Need a Business Plan Example to Make It?

Short answer… NO!

Lots of business people started their business without one and have succeeded. That said, If you have a truck load of cash to start off, you can make it too without a plan. But if you don’t, it’s a much smoother road if you have one. Especially if you’re chasing finance, for this scenario you’ll need to present a full blown plan.

However, if you happen to own a successful business, your financiers may not even require you to have a plan but it will always increase your credibility & viability.

8 Reasons for Writing a Business Plan -

1. To increase the credibility of a finance application

2. To help raise equity funding

3. To define your objectives and strategies behind them

4. To allow regular reviews to identify change

5. Identify possible joint ventures

6. Facilitate & record partner agreements

7. Record the business value for sale or legal requirements

8. Evaluate new opportunities and/or products

Aah, Brain Lock!!

We’ve all had it some time or another… sitting, staring, the screen saver the only thing stopping us from dropping off. Racking your brains trying to come up with a business plan example can be just plain frustrating.

Here are some options you might like to think about -

What About Software?

With a clever software package assisting you, commencing with some business plan examples beats staring at a screensaver hands down.

Software… the great brain lock remover.

Good software should provide prompts for the primary concepts and present you with the framework to kick off and, there are many good books available to assist you in creating a good business plan.

Hire an Expert.

You can contract an expert to help develop your plan but that will more than likely cost more than some good software and… you’ll still have to provide the primary theme and ideas. Plus, you’ll need to monitor the work so the end result is a workable, logical business plan example that you and your supporters can follow.

While writing a solid business plan is a necessary first step in getting any new business venture off the ground, creating such a business plan is not always an easy task.

The goal of the many business plan software packages on the market is to make the process of creating a winning business plan that much easier.

When choosing from among the many business plan software titles on the market, it is important to know what to look for, and to know what you need from the business plan software you plan to purchase.

These software packages can be quiet pricey, so it is important to shop around for the business plan software package that gives you the greatest bang for your limited business dollars.

Making Sure The Business Plan Software Includes Sample, Examples And Templates

One important thing to look for when shopping for business plan software is the availability of a number of different business plan samples, examples and templates.

These examples and templates can make it a lot easier to create a quality business plan in a short period of time.

Look For A Flexible And Easy To Use Software Package

It is also important that the business plan software package you choose be easily customized to meet the needs of your own type of business.

Each industry has its own unique needs when it comes to business plans, and it is important for the business plan software to be flexible enough to allow changes to be easily made depending on the type of business.

Those business owners with more than one type of business will especially appreciate a business plan software package that is flexible and easy to use.

The Business Plan Software Should Easily Interface With Other Accounting Software Programs

It is also a good idea to look for a business plan software package that easily interfaces with the most popular accounting software, business software and general productivity software available.

It will be a big help to have the business plan software be able to pull in facts and figures from a variety of spreadsheets, accounting packages and other sources.

A business plan software that can use information from a variety of existing sources can greatly reduce the workload on an already overloaded business owner.

Business Plans

I have often been asked by aspiring entrepreneurs:
- Should I write a business plan?
- If so, where do I find information on how to write a business plan?
- What should be included in a business plan or how detailed should it be?

These are good questions. Let me begin by saying that there are several preliminary steps that should be completed BEFORE embarking on the arduous task of compiling and organizing data into a comprehensive business plan.

Usually, after a process of determining whether a business idea is worth pursuing, entrepreneurs immediately launch into a process. For some entrepreneurs, the process of validating the idea is relatively quick, while for others it is exhaustive in scope. However, over the years, I have observed there are some preliminary steps to be completed before starting to develop the business plan. These preliminary steps are a three step process I refer as the Gut Check Mirror (GCM) Test:

1. Figure out if you really have an entrepreneurial personality profile. Many people assume because they have been successful in the world of traditional employment that they will automatically succeed as an entrepreneur. Wrong! Wrong! Wrong! I am so passionate about preventing entrepreneurs from making this mistake, that I wrote a book on this specific topic called Transitioning From Employee to Entrepreneur – A Roadmap for Aspiring Entrepreneurs.

The premise of this thesis is that success is not guaranteed based on past successes in the employment environment. These are three simple steps to take before making the decision to invest a substantial part of your net worth, commit 3-7 years of your life, and put your future on the line in an attempt to become your own boss. One of the first things you need to do is evaluate your personality profile by taking an entrepreneurial profile test. This beginning step helps to make the determination if you have what it takes to be an entrepreneur.

2. After validating your entrepreneurial profile, the next step is to determine what type of entrepreneur you are. This is another critical step many ignore – at their peril. There are four business models for an entrepreneur to consider in making the decision to become his or her own “boss”:

a. Starting a business from scratch
b. Buying an existing business
c. Becoming a franchisee in a franchise system
d. Becoming a consultant in your area of expertise

Each of these business models has advantages and disadvantages, as well as commonalities. How do you decide which business model is right for you?

- If entrepreneurship is core to your personality, you should probably start your own business.
- If your risk profile is middle of the road, then buying an existing business may be a better fit for you.
- If you like the idea of starting your own business, BUT you do not want to risk starting a business from scratch AND you do not necessarily want to buy somebody else’s business, franchising is probably your best path.
- If you have limited funds BUT you possess a high degree of technical expertise in your field, becoming a consultant might be the best choice.

You need to decide which business format suits you best before deciding on the business you want to either start or buy, or sign on as a franchisee or consultant.

3. After you complete the first two steps, a specific business can be selected and then you can begin the process of developing a business plan.

Business Plan Development

There are five steps to writing a business plan.
1. Format. Determine what type of process or format to use. There are three:

a. Write a business plan from scratch
b. Use business planning software or a template
c. Engage a consultant to assist you in writing the business plan

Each of these alternatives or formats has its own advantages and disadvantages:

Business plan from scratch

The advantages of crafting a business plan from scratch is two fold. First, it is the least expensive way to go; second, although it requires a lot of work on your part, you become familiar with the data because you are the one doing all of the research and compiling all the data.

The disadvantages are, first of all, it is time consuming; secondly, if your business plan is going to be used to secure business financing, it may not be in a format with which lenders are familiar. Do not underestimate this factor. Lenders are lazy. They want facts presented in a format that makes everything easy to see and understand.

Business planning software or template

If you decide to use a template or business planning software, this will streamline the business plan development process. One of the most comprehensive template software programs is from Palo Software: http://www.paloalto.com/. Their software costs $99.95 for the Standard Version and $199.95 for the Pro Version. This platform is especially powerful and can be used for a range of business models, from very simple to the most sophisticated plans imaginable.

There are free versions of business plans provided by www.score.org and on the Internet for basic business planning. Simply go to Google.com and search “Free Business Plans.” You should beware that some of templates you will find listed on this search may be inadequate for your needs, especially if you are attempting to secure financing.

Consultant services

Finally, if you decide to engage a consultant, there are three alternatives to consider.

o Non-profit organizations such as local Chambers of Commerce mentoring programs, Score.org and community colleges
o Paid professionals such as your CPA or financial adviser
o Business plan consultants who make their living writing business plans. These consultants vary in price from less than a thousand, to as high as five to ten thousand, depending on the sophistication of the plan.

2. Research. After deciding on the methodology you are going to use to develop your business plan, the next step is to begin the research. This research will encompass the following factors:

a. Competition. It is important that you conduct a thorough study on the depth and scope of the competition, the strength of each competitor, chinks in the armor and how you intend to exploit these weaknesses.
b. Pricing model. What the margins are and what your margins need to be.
c. Real Estate. In many businesses, location is the main determinate of success (Location, Location, Location). If there is a significant relationship between success and real estate, you must research this area extensively.
d. Equipment. If the business requires specialty equipment, then separate financing options may need to be considered, as well as delivery and installation times.
e. Staffing. If the business requires technical expertise, what is the market price for this expertise and what is the recruitment strategy? Inadequate research and understanding in this area can bring a new business to its knees very quickly.

3. Revenue and Expense Models. Depending on the sophistication of your financial model and your familiarity with Microsoft Office Excel and the creation of financial projections, this component may need to be outsourced to a financial professional. The template business plans have preformatted cash flow spreadsheets, income statements, and balance sheets, all integrated into a smooth presentation format in the business plan. However, depending on the complexity of your financial mode, a great deal of financial acumen may be needed to properly compile these details in a meaningful fashion.

4. Financing Plan. The most useful tool for obtaining financing is a well-crafted business plan with thoroughly developed assumptions and research references. There are four main choices for financing, with a less common fifth option:

a. Personal funds; i.e., savings, retirement funds and investments
b. Personal borrowing; i.e., home equity, family and friends, credit cards, unsecured bank loans
c. Equity, personal or third part angel investors
d. Business loans from institutional lenders
e. Venture capital (usually reserved for high tech businesses and concepts)

5. Exit Plan. All too often, this is not considered in the initial planning process. Yet, it is arguably one of the most important elements of a business plan, because without a successful exit, most of the effort in starting and managing a business is for not.

Writing a business plan need not be an overwhelming task if it is approached systematically and methodically, following a time tested process.

Small businesses serve as the backbone to a nation’s economy. They are the critical factor in ensuring the recovery and growth of any economy. Governments around the world are aware of the significance of small businesses and thus instituted programs that would encourage, assist and support this sector of the economy. In the United States, the government agency that is tasked to provide support to small businesses is the Small Business Administration (SBA).

If you think you have a good idea for a product or service that would sell, you should try to make a go of it. While it is true that it is difficult to start a business and that you will have to take some risks, there are steps that you can take to increase your chances of success. Be sure to do your homework before risking your lifetime savings on your new business venture. Study all that you can about the industry or line of business you want to enter. Look into the viability of your idea and test the feasibility of the business you have in mind. Write a business plan so you can put your many ideas into a cohesive plan of action.

There are many online resources that can be of big help during your planning phase. The SBA website (SBA.gov) is one valuable online resource and you may want to check it out first. The SBA’s small business planner on the site provides highly informative material that can assist you at any stage of the business life cycle.

The Small Business Administration

The SBA was established in 1953 by the US Congress with the goal of maintaining and strengthening the country’s economy by way of establishing small businesses, as well as assisting in efforts for economic recovery of those communities after disasters. The SBA’s basic functions include aiding, counseling, assisting, and protecting the interest of small businesses.

Although many think immediately of loans when talking about SBA assistance for small businesses, the SBA by itself does not offer loans to small businesses. It has numerous loan programs, but the SBA acts only as a guarantor of loans made by private lenders and other institutions. The only loans that the SBA grants directly to borrowers are the Disaster Relief Loans.

Other SBA services include technical assistance, training and counseling in entrepreneurial development, women business ownership, Native American affairs, and international trade, among others. The SBA also provides assistance to businesses seeking government contracts. You should be able to receive support and assistance from the local SBA office near you.

If You Need Loans and Financial Assistance from the SBA

You will need to be eligible to apply under any of the SBA loan programs. Primary consideration is the repayment ability from the cash generated by the business. Other factors considered are good credit and character, management capability, collateral, and owner’s equity contribution. All owners that have a stake of at least 20% in the business are required to personally guarantee the business loan obtained through the SBA.

There are several business loan programs being offered by the SBA but the most basic and common type of loan applied for by small businessmen is the 7(a) loan. The 7(a) loans are known as such because they refer to section 7(a) of the Small Business Act, which authorizes the SBA to provide business loans to American small businesses.

Most American banks and some non-bank lenders participate in the 7(a) program of the SBA. They provide the loans to small businesses following SBA guidelines in exchange for a guaranty from the SBA against payment default. However, the SBA does not fully guarantee 7(a) loans as a precaution against irresponsible decisions by the lender or misrepresentation by the borrower. Under this program, lenders arrange and administer the loans.

The SBA is committed to provide business guidance and support to help small businesses increase their odds of long-term success. You too can benefit from SBA assistance for small businesses. All you need to do is ask.