Out of 300 people polled, 72% said they did NOT have a written business plan.

The truth is that most of you reading this article do not have a written plan.

Why?

Let’s see. You know you need a business plan. You’ve heard it from many sources, “Write your business plan!” So, you sit down and begin. Hmmm… bios, sales and growth projections, competition, graphs, marketing. It all seems so overwhelming. You realize this is going to take longer than you thought. You put it down to continue another night. That night doesn’t come.

Sound familiar?

How about this scenario: you actually finish your business plan. One year later, you realize you have not accomplished your goals, your finances are not where they were projected. You feel like you are failing.

Can anyone relate?

Relax, it’s okay. The big business plan gig is really not for us small, home-based owners. So, scrap the big business plan.

Here’s a better idea.

It’s not that big business plans don’t work for us, rather, they can’t work.

The traditional business plan is really only for one reason — to sell your business idea to investors. If you’re looking for venture capital, you have to put together a big business plan, and a very good one at that. While a very small sampling of you may wish to go this direction, the reality is that most home-based business owners are simply wanting to make a decent living at home.

In a poll of 300 online home-based business owners, 64% said they work part-time on their online business and receive part-time income from it. A pretty big chunk of online home-based businesses. These are people who are simply looking for a little extra cash, or they look at their business as a hobby.

In contrast, a paltry 16% of home business owners works full-time at home and receives full-time income. I would venture to say that an extremely small percentage of this group is actually looking for serious venture capital to take their business to another level.

Don’t get me wrong, we could all use a little extra funding, but that’s not what we’re talking about here. A few thousand dollars to start up your business doesn’t usually come from investors.

Keeping this in mind, if we put together a traditional business plan (to impress investors), generally, what we put into the plan, will be the wrong things for the wrong reasons. If impressing the investors is not your intent, you can’t succeed in this kind of plan. It’s that simple.

So, do you actually need a business plan?

Oh, yes! You simply don’t need the traditional business plan. Rather, what you need is a plan that will help you (and only you) take control of our own business. Think of it as a guide that will give you direction and keep you on track.

Ask yourself these questions:

1) Why am I doing this business? What are my motives?

2) What do I personally want to do with this business? What do I want to gain?

3) What are my personal strengths to offer to the business? What are my weaknesses?

4) What new knowledge will I need?

5) What parts of my business can I outsource?

6) Where do I want to be in six months from now? One year? Five years?

See the difference? These questions are you-based. Write down your answers as a preface to your plan. Refer to these questions often and adjust your answers as your perspectives change over time and as your knowledge grows.

Now, with the above in mind, go ahead and pencil in your thoughts on the following. Your answers won’t have to be terribly involved. This gives you a roadmap, nothing more. And, it will change and evolve over time. Remember, you’re not answering to anyone but yourself. You’re not trying to impress anyone.

• Business Mission Define it as YOU see it.
• Evaluate the Past Take stock in what your business has done in the past year. Summarize your business’ strengths and weaknesses. Ask yourself, “Is my business profitable or does it indicate that it will be?” “Have I attracted new customers?” “Have I maintained customers?” “Am I happy with where my business is going?”
• Your Personal Competitive Edge This is not about your great domain, nor what great products you have, rather, this is what YOU, personally offer… your own innovation, what powers your business. YOU are your small business’ brand, its greatest asset. You must think in these terms.
• Your Business Competitive Edge This is where you list your products/services. Separately list those you have and those you plan to add. Include any patents, logos, designs, licenses, domains, any kind of intellectual property.
• Customer Relationships As a small, home-based business owner, your marketing is very different from big or even mid-sized companies. Your marketing heavily relies on relationships. Write down the ways you make or plan on making relationships with your customers. Think innovatively in terms making relationships. Don’t simply jot down a laundry list of ways you will advertise.
• Business Relationships List your partners (your spouse?), strategic partnerships you have made or plan to make, mentors, industry experts. Who generally and specifically will help you grow and develop your business? List external and management relationships such as your banker, your CPA, your attorney. List your suppliers. Think about how involved you want your family and friends to be involved in your business.
• Finances This should identify a clear plan for quantifying results. Develop landmarks and goals. Yes, forecast, budget and project. This is something you need to do to keep your focus. Review this from time to time and set yourself back on course if you begin to stray, or re-evaluate to make more realistic changes.

Phew! Now, take a deep breath and you will find that this exercise will actually do more to help you focus and grow your business the way YOU choose than any other traditional business plan ever could.

Why not sit down and give it a try. And, if you have any ideas to add to the above, by all means, give me some feedback.

To be successful in business, you need to conduct research and write your business plan. Attempting to start a business without a (well-composed) business plan through feasibility study is like a stranger going to an unfamiliar terrain without prior direction. Or better still, it is like a ship without a rudder (which controls its direction). It is in the light of this that the publication of this text entitled “Seven Step Business Plan”, written by Ms. Sheila Holm, a respected business-management expert is a welcome addition to business management literature.

Holm says before preparing this text, she had cycled and recycled clients to every bookstore to work through every business-planning book option. She adds that the clients purchased many books but still wanted more help. Holm discloses that to make it easy and affordable for more business owners to receive help, she started conducting a series of seminars to help owners and their management teams develop their business plans within a seven-step format based upon their dreams and goals.

Holm says the outline of the seminars developed rapidly into a seven-step, one-page form for quick and easy review while updating the business plan according to each change and adjustment to the goals.

The author educates that having a business plan adds value to the bottom line of a business. She adds that this text removes the learning-curve requirement, stressing that she knows you can increase the productivity and profitability of your business when you write your own business plan.

Holm says whether you have not yet written a plan, you have paid a consultant to write a plan, or you have proceeded with your business idea before writing a plan, you are absolutely in the majority. She submits that the truth however is that no other owner, director or team leader can articulate your business idea better than you can, stressing that planning is the key to success and profitability.

Structurally, this text is segmented into seven chapters. Chapter one is entitled “structure”. This author educates here that immediately in your own words, you should begin writing a statement about “how it is around here” according to how you are going to proceed with your business. Holm says many owners, even after they open the doors and operate their business, proceed without a clear statement about their business: how it will meet the needs of customers or how their business relates to the industry. The author adds that their dreams and goals are not in writing or in focus yet.

She stresses that clarity is helpful and has a positive impact upon your bottom line. This author adds that if you want more profit, then you need to gain clarity and if you want more clarity, then you need to schedule a little more time to walk and/or work through the planning process with her.

According to Holm, businesses develop in phases, so it is important to begin the planning process by identifying the part of one or more phases, or stages of development, of the business process your business represents. The author discloses that your business may be at a point where you want to add a phase to your existing plans or it may be an idea that you want to sell to someone else. You may want to purchase a developed product in order to market and distribute it, or you may be starting a business that will include all phases of the business process, expatiates Holm.

She says this stop is a major decision point since it will match your expertise and passion with the type of business you should pursue. In her words, “So, take a moment to get comfortable and get a firm picture in your head of yourself as the owner of the concept or product in one or more of the key phases of the business.” Holm also discusses idea; development; location; production; marketing and sales; distribution; and repairs or redevelopment in this chapter.

Chapter two is based on the subject matter of placement. Here, the author says the biggest mistake owners make is to think they have the most unusual business idea. Holm stresses that she is always concerned when a client says she should hurry up and develop a business plan before someone else steals the idea.

She reveals that ideas are out there and we do not have the market cornered on any idea. The author adds that only very few people with ideas will proceed and develop the ideas into a tangible entity, a business that will become part of the marketplace. She stresses that you are the exception to the rule.

The expert submits that now that you have set out to pursue your idea, it is important that you continue to follow and recognise the needs of the market that initially inspired you. She explains that if you understand the placement of your business within the industry, it is as important today as it will be that every day you are in business.

In Holm’s words, “Too many businesses forget to stay current regarding the trends within the industry and the business, market in general. The business process is a fluid process, so do not plan on making a decision regarding placement and then setting your business idea into a concrete base and forcing it to hold up to this statement for more than a few weeks. This is why I absolutely recommend reviewing the Seven Step Business Plan form each month.”

She illuminates that this phase of planning your business is a good time to meet and interview experts. On the aspect of customers, Holm says if you think everyone is your customer, take a second look at the facts about your business and what it will provide to the community. The author educates that defining your customers will assist you in the process of matching your business with the top competitors in your industry She adds that you have to know your competitors and how they are doing business within your industry.

“Begin with the title ‘Competitors’ on a page of your notepad. Add names to your list each time you identify a business in your industry. Expand your list and add all related businesses, increasing the scope and parameter of your search. This list will also help you gain an objective view of how the various businesses affect your business and your industry,” educates this expert.

Chapter three is on the concept of leadership. Holm says the most important statement you can make about your business is the statement you make about yourself and your involvement within each phase of the business. She adds that the statement you make about each member of your leadership team closely follows the importance of the statement you make about yourself.

According to this author, your leadership ability is critical as it is your ability to inspire others. Holm emphasises that leadership skills and abilities develop into the team strengths that are going to be evident in the business structure and help sell the business to each customer, vendor, employee, and business. “Remember, you are not able to be all things to people within the team. Each leader plays a specific role, and the team’s strengths and support in areas of weakness will define the overall strengths of the business,” guides the author.

The business management expert educates that when you detail your involvement, you should ensure that you align your statements with the phrases you have written to describe your business today and your plans for the future of this phase of the process. She adds that this statement will need to remain flexible in order to complement the plans for each aspect of the business as you continue to refine them.

In chapters four to seven, Holm analytically X-rays concepts such as purpose and highlights; vision and mission statements; operational and marketing plans; and financial and profit plans.

As regards stylistic assessment, the report card of this text is in blue. For instance, a lot of textual and graphical illustrations are used to reinforce the understanding of readers. The book is also very educative in that the chapters are further broken down into many sub-segments to achieve simplicity and easy comprehension on readers’ part. Holm includes one-page fill-in-the-blanks form representing a prototype for a typical business plan to guide readers. What’s more, the language is simple.

However, a technical error is noticed in the text. This is the omission of a hyphen in-between the first two words of the title of the text “Seven Step Business Plan”. Omission of the natural hyphen has grammatically deprived “Seven” and “Step” from becoming a nominal compound modifier to the phrase “Business Plan”. It is structurally supposed to be “Seven-Step Business Plan”. Without a hyphen, one will also be grammatically compelled to add an “S” to “Step” because of the cardinal word “Seven”.

On the whole, the text is a necessary companion for (prospective) entrepreneurs, business managers, etc. What else would you expect me to say if not that “it is highly recommended”? Get a copy of this book today and learn how to write a business plan so that you can achieve business can succeed.

I stumbled on a very interesting article that lead me to a very interesting competition. The article appeared in the New York Times on Friday 16 April with the following heading, “Can You Write a Business Plan With Fewer Than 140 Characters?” The article was written about a competition being run by the Massachusetts Institute of Technology (MIT) in conjunction with their MIT $100K annual business plan competition.

They call it the TWITCH (Twitter Pitch) contest. And this brings me to the topic for this article, “How long should your business plan be?” Here are some of the advice you may find on the Net:

• It can vary from a 10 to a 100-page document;
• It should be short enough to not bore your reader;
• The shorter, the better;
• Shouldn’t take up more than 25 pages;
• Limit the plan length to 15 pages;
• 15 to 25 pages is the optimum length;
• Basic plans are under ten pages;
• Comprehensive plans are often 10-25 pages long;
• Length should be 20 to 30 pages max;
• Can be any length.

The general feeling is that shorter is better. A few factors should dictate the ideal length of your business plan.

The nature of your business – The simpler the shorter, the more complex or “new” the longer.

Purpose of the plan – To raise millions may have to explain a lot more.

We personally believe that the shorter the better as long as it achieves its objective. One expert said that “A business plan needs to be whatever length is required to excite the investor, prove that management truly understands the market, and detail the execution strategy.”

The “empathy” test, once the business plan has been done, is to put yourself in the shoes of the audience and to ask yourself if you would have done what you want them to do based on what you see and read.

If the plan does not pass your “empathy” test there may be several reasons for that and one of them may be incomplete information. This will require that you add more pages.

If one looks at the advertising industry the greatest challenge is to sell a product on the TV in a 30 seconds commercial. Can you sell your plan in 30 seconds? We therefore go for the “Short is good, long is bad.” approach. When we look at the various areas that should be covered in more detail we will endeavour to indicate how long each section should ideally be.

In the next article we’ll have a look at the concept of the “elevator speech” and how that can become a powerful tool in business planning.

Happy planning. Make it a challenging, exciting and creative experience.