Having an idea is one thing, but having a legitimate business plan is another story. A proper business plan gives you a significant advantage. So how do you make a business plan? In simple terms, a business plan is the written description of your company’s future.
You outline what you want to do and how you’re planning to do it. Typically, these plans outline the first 3 to 5 years of your business strategy. The business plan needs to be the first thing on your list because you’ll use it to help you with some of the remaining steps.
Most likely you have already identified a business idea, so now it’s time to balance it with a little reality. Does your idea have the potential to succeed? You will need to run your business idea through a validation process before you go any further. In order for a small business to be successful, it must solve a problem, fulfill a need or offer something the market wants. There are a number of ways you can identify this need, including research, focus groups, and even trial and error.
One challenge many business owners face is that they don’t know how to sell. It can be intimidating to share your business with the world, especially when you’re new. If you’re worried what people will think about your business, you need to get over it. If you can’t convince consumers to buy from you and support your company, it’s difficult to make money. Not outgoing? Fake it ‘till you make it. If you really want business success, you can’t afford to be shy.
Running a business can be overwhelming, and you’re probably not going to be able to do it all on your own. That’s where third-party vendors come in. Companies in every industry from HR to business phone systems exist to partner with you and help you run your business better. When you’re searching for B2B partners, you’ll have to choose very carefully. These companies will have access to vital and potentially sensitive business data, so it’s critical to find someone you can trust.
Validate your business idea by creating a pitch page. To determine how attractive your prospective market really is (your own desires aside for the moment), we suggest doing a market analysis. If you like, you can even take things a step further and consider the consumer needs currently not being met by businesses in the industry. This is a good time to take a look at potential competitors. And remember, the presence of competitors is oftentimes a good sign! It means that the market for your product or service already exists, so you know that you have potential customers who are willing to spend money on your product or service.
Know yourself, your true motivational level, the amount of money you can risk, and what you’re willing to do to be successful
Sure, we all want to make millions of dollars. But what are you willing to give up to reach that goal? How many hours a week will you work on an ongoing basis?
How far out of your comfort zone are you willing to stretch? How far will your family stretch with you? To be successful, keep your business plans in line with your personal and family goals and resources.
Know when to get help. Too many entrepreneurs try to do everything themselves. “You will have a tremendous amount of responsibilities” warns Sandy. “Time management will be key to accomplishing the majority of your tasks, (but also) take a step back and determine if it is time to hire someone and/or individuals on board to assist.” Find mentors who can “help you to navigate the myriad challenges that come with being a business owner,” advises Lambert. Research from the Small Firms Economic Development Initiative found that 70% of small businesses that receive mentoring survive more than five years—double the rate of non-mentored businesses.”
If your heart isn’t in it, the temptation to bail during difficult times will be high. If you’re able to do something that you love, you’ll have much more motivation to keep persevering.
Startups require more than a 40 hour work week—make sure this is something you’re willing to do around the clock!
“Visit your competition and introduce yourself. Nurture and develop a good relationship with them. Refer customers to them, as well. It’s give-and-take and there really is enough to go around. Don’t be afraid to ask them for help or advice.”
You may cook an incomparably delicious hamburger or make a mean pizza, but before you try to build a business around that talent, think about how you are going to distinguish your business from every other hamburger or pizza restaurant.
It’s important to consider factors like price, taste, décor, service speed, advertising and other choices and define how you can set your business apart.
There will always be someone willing to do things cheaper so be careful about competing on price. Instead, compete on your service level or something else that makes your business unique. Price shoppers always will leave for the cheaper price, but customers that truly value your unique offering or service are more likely to stick around. In an ideal world, we’d all have our to-do lists checked well before the beginning of the year to guarantee a solid start to the new year. But regardless of when you plan, the point is to get it done.
To be honest, a lot of one-person startups skip this step or gloss over it. But that’s not a good idea. A business plan forces you to look at all the marketing, operational and financial information you’ve collected, and to lay out specific plans, goals and timetables. Once it’s written, it will serve as a road map to keep you on track and help you reach your business goals. That’s why it’s important whether you’re planning a business that will require a lot of money to start, or just want to be a one-person business.
You need a support system while you’re starting a business (and afterwards). A family member or friend that you can bounce ideas off and who will listen sympathetically to the latest business start up crisis is invaluable.
Even better, find a mentor or, if you qualify, apply for a business start up program such as the ones provided through Futurpreneur Canada. When you’re starting a business experienced guidance is the best support system of all.
Just because you’re the business owner doesn’t mean all the pressure lies on you. Your budget involves everyone in your company, so each worker should be aware of its principals and add any insight or ideas they deem necessary. “A proper budget is far too important and there are too many variables for this responsibility to fall on one person’s shoulders,” said Nate Masterson, marketing manager for Maple Holistics. “An ideal budget should undergo intense scrutiny by a team of employees with a diverse set of skills to effectively manage a small business budget.
When you are just starting out, bringing in a consistent profit month after month can be challenging and stressful. You don’t want to be the position where you’ll do anything for a quick buck.
You want to focus on building something that will make you $2000 passively everything month down the road and not worry about making $100 to survive the week.
Keeping your day job until your business is financially stable will reduce pressure so you can focus on what matters. Remember – it’s not how you start the race, it’s how you finish it.