Writing Winning Business Plans. Garrett Sutton
business, your market, your industry or the overall economy and regulatory environment can be useful. Consider it just another aspect of research that accompanies your personal learning from advisors, peers and mentors. It is critical that you learn the brutal “street smart” realities of your business.
Start a file system for all the information you will be gathering. You might consider breaking up information into pertinent subject headings that reflect the subject headings of your plan. Or you might want to break out information by date or source – whatever works for you. As you come across new leads or new information, stick it in the appropriate file. Then when you get down to the business of preparing each individual section, you will have at least some of your research already done.
The Issue With Questions Posed
You will note as we go through this book that a lot of questions get asked. For example, in the chapter of Marketing, many questions are asked on the nature and the type of your customers. These questions aren’t posed to harass or burden you. Instead, they are important considerations for you to review. They are put forth to get you thinking about what to write about. Like a snowflake, every business plan is unique and different. No two are alike. Different questions must be addressed and answered in each plan. But like a flake, if you totally ignore all of the questions you won’t have much to show for your efforts.
So when you are reading a list of questions to be addressed, pick out the ones that pertain to your business. And then answer them in your plan. Don’t let your eyes glaze over as you read the questions. Instead, keep them to pick out the ones that will allow you to prepare a winning business plan.
“If you don’t know where you are going,every road will get you nowhere.”– Henry Kissinger
Why are you in business?
Sophisticated investors and lenders want a peek into your heart to see if you have what it takes to be successful. Their answer often lies in your mission statement. A company’s mission is sacred to true entrepreneurs because it is the essence of who they are and why they are in business. In Rich Dad’s B-I Triangle the mission is the foundation and bedrock of a company. Not having a strong and clear mission is unacceptable because it answers the most important question of all, “Why are you in business?” If your motivation isn’t strong enough, nothing else matters.
All for-profit businesses are in business to make money, hence the name for-profit. The question is:
1) Are you in business first to serve people and second to make money? or
2) Are you in business to first make money and second serve people?
Many novices fail to recognize that a business which seeks money over a higher purpose has no soul. The answer to the above question is that great entrepreneurs are in business to both make money and serve a higher purpose. The key is balance. When one motivation becomes too great it begins to harm a business.
Great entrepreneurs balance their business mission with their spiritual mission because both are essential and linked to one another. Rarely will a business without a strong sense of purpose survive, especially during the beginning stages because it is a team’s desire to genuinely make a difference that inspires it to weather the trials every business goes through.
A company’s mission also helps it maintain focus throughout its life. As a compass for the company, it provides a strong sense of direction to you as a reminder of why you got into business and what direction you ought to head. The mission provides a useful benchmark to evaluate opportunities and set goals.
It is often helpful to explore your intentions on paper. Putting pen to paper helps put your thoughts in order and helps you see connections you aren’t making in your head. Try getting a journal and a good pen and write about your intentions, your wants, dreams and needs. Don’t think, just write. Start a page with a question and just keep going until you fill a few pages. Try this exercise for a week or two and then go back and read through what you have written with an eye toward patterns. Look for repetitive words and themes.
Here are a few ideas to get you started:
“I have always wanted to…”
“If I knew I could not fail, I would…”
“I will be good at my business because…”
“I want to offer my product or service because…”
“In five years, my business will…”
“I am best at…”
“I can make the biggest difference in the world by…”
“I can serve the most people by…”
Goal Setting
If you think of your mission as a compass, you can consider your goals the map. Goals are the step-by-step plans that will make your dreams come true.
It’s a lot easier to get what you want if you know what you want. Though your personal goals may not be spelled out explicitly in your business plan, they will color all aspects of your plan and thus your business. What are your personal and business goals? Are you in it for the freedom? Do you want financial security in the long haul? If so, what does that security look like? What is your exit strategy? Do you want to eventually go public? Do you want to establish a business that can be sold for a large profit? Do you want to have a thriving business legacy to leave to your children? What about franchising or establishing multiple locations? (See, we just threw a lot of questions your way. You may not want to answer every one of them. But answering at least one of these questions is important for you. Good. Now, back to our narrative.)
Odds are you didn’t decide to start a business because you like the long hours and personal/family sacrifice that go along with such a venture. Instead, the odds are that you see payoffs for your time and effort and the ability to make a difference to society. Those payoffs are a good place to start your review of mission and goals. What do you want out of your business?
Your main goals should be measurable in time, dollars, quantity or comparison. You might have goals of a certain amount of profit (dollars) for a certain number of items (quantity) by a certain date (time). Your goals might include a particular ranking in the market (comparison) or a percentage improvement (comparison) or a number of days without injury (time and comparison). If you can’t measure it, it’s not a goal. For example, wanting to be the best in the business is not a good goal unless you can measure “the best” in dollars, quantity, or other concrete comparison.
You will also have steps you can take to achieve your goals. These steps can be considered support goals or tactics. Support goals are more strategic than primary goals. For example, if your goal is to decrease injuries by 20 percent, your support goals might include holding a worker safety seminar, implementing a worker safety plan or establishing fines for unsafe conditions (or rewards for safe performance).
Remember that the business plan is only an overall guide, not a step-by-step accounting of business practices. This is not only due to a need for brevity, but also due to the fact that business plans often make it into public hands (especially in the case of a public offering). Don’t put anything in your plan that you wouldn’t want to see in the newspaper. Better safe than sorry.
Whatever goals (primary or support) you decide to set for your business, be sure to write them down. Add your goals to your journal for a few weeks before you start writing your plan. Do your journaling the way it best suits you. If you struggle with the all-consuming blank page, try writing in your journal whenever you get a new idea. Buy some brightly colored pens and choose a journal with a picture or texture that inspires you. If you are the type to just get down to business, set aside time each day to sit down with a good, sturdy journal and a reliable black pen. Whatever your style, take the necessary step of exploring your dreams and goals on paper.