business plan

Let Your Survey Write Your Business Plan

Most entrepreneurs first write their business plan and then develop their
services or products. This causes them to generate and fulfill a marketing plan
that requires them to swim upstream using the backstroke. To save the stress,
consider placing the business plan on hold until first completing a few customer
surveys. Okay, some of you are saying, “Catherine, how can you do a survey
before you know who your market is?” Yes, this is one challenging double edge
sword, that is, if you’re mindset is set there.

Over the years, I’ve found that everyone I’ve worked with generally knew what
he or she wanted to sell. I don’t believe you are any different. This is the
perfect place to start. You have a clean slate to write on. You might be at a
place of seeing it in nonspecific terms with measurable doubts as well. That is
okay, doubts will always be there, thus, allow them to be your friend instead of
a foe. It’s easy to start with a gender preference — choosing either women or
men as having a higher purchasing balance for what you are selling. If you don’t
have a majority gender in mind, choose the one you feel most comfortable talking
with or asking questions to.

Let’s dive in a little deeper, its time to start thinking about your surveys
and what to ask. Okay, don’t fade out on me now. Generally, when people think of
surveys, they visualize or experience the sensations of long drawn out processes
that cost more money then they can afford or time that they don’t have the
patience for. Boy, do I remember those days of thinking.

Let’s play together on this concept of taking surveys before writing your
business plan. At least, allow the old perceptions to sit outside your door
until you’ve finished reading this article and learning of a new possible
alternative perspective. The perspective that surveys come first and don’t need
to be time-consuming, money-hungry, must be done by professionals, mongrels.

Take the area you want to focus on, combine with your gender preference, and
begin there. For instance, if your area is life coaching and you feel more
comfortable with working with women you have a starting point. This doesn’t mean
you will never coach men, set those thoughts aside; they will block your
progress and keep you stuck.

From knowing just this basic information, you can now create a few simple
surveys in no time at all that don’t require any money. Even if you know more
specifics about your buyers, you might want to back it up to this point if you
are stuck in generating questions. To generate this survey plan you don’t need
to know whether your focus is for a product or service, or even if its for
electronic, telephone, or in-person delivery, at this time.

The first question you want to generate and ask is what your gender wants to
buy next. If asked in narrow terms, they will answer. If asked too broadly, they
will respond with “don’t know.” If the latter, rewrite the question more
specifically, then ask again. Whenever I start, I sometimes have to revamp my
questions five or six times. Just an FYI, to help you understand that even the
experts refine as they go. Surveying is an evolutionary process.

A second survey question is for people who have purchased from you in the
past. What are looking for next? What do they want to accomplish in the next few
months or whatever future terms they desire to talk about?

If you don’t have any customer history, then substitute. Open the scope to
what is the gender buying? What is the cross between what you offer and what
they want? What do they want to do next (short-term) that falls within your
scope?

Continuing with the life coach illustration, what type of women, what age
areas, what type of self-development or improvement topics are they purchasing
now? What is the regular step past this? What “new” hot topics in the
marketplace that meshes with your area? If you attend a workshop, conference or
seminar, examine the topic, and take notes on the type of women attending.
Record or ask their age group. Ask a few to complete a survey while they are
there.

Ask one way, then another, and create a list of no more than six multiple
choice, yes or no, questions to ask. Then continue to ask with whomever you
meet, wherever you go. Talk with the workshop leader or conference marketing
people and find out who they were targeting and why. If the event is a match for
you, collect copies of all their marketing materials for language learning.

Ask friends, family members, or colleagues. Even if they don’t think these
groups fit within your current focus. Just remember not to stay off focus when
doing so. If you attend a coaching school, ask other coaches that do what you
want to do. What are their clients into, what are they selling them or what
ideas have their clients told them that they are looking for?

Your survey method you use is up to you. To ease into it, you will want to
ask in the form most comfortable for you at the time. However, caution, most
everyone chooses written form first in order to avoid any negative responses. In
a B2B survey, negative responses never occur. Everyone knows why a survey is
important. In B2C (business to consumers) be careful not to cross the line of
interrogation or too personal. Ask politely, with respect, and share why you
want to know.

The number one rule of getting survey responses — is KISSing the questions
– “keep them short, simple and as specific as you can at the time.” Special
note: Don’t use the contraction and in your sentences. The contraction “and”
creates a multiple question, stacks questions, which confuses readers and
listeners on what you really asking.

As you go through the experience of completing your surveys, new clarity will
flower. The gender equation gets more specific, the age group narrows, and the
rest unfold. One industry category might begin to show you where there is
greater revenue generation. Allow the data to drive you towards the right
direction. Don’t try to control or drive it yourself. That struggle will cost
you dearly.

If you’re survey request is in the form of writing, you can offer something
in return for an exchange of their time. Usually saved for longer surveys, you
can create a reward for short surveys too. It’s its too early in your survey
process to know what prospects want, offer something generic. Match the gift
with the amount of time it takes them to complete the survey. If this is the
case, offer something generic. Offer a $5 gift certificate from Amazon.com. If
local, ask you’re favorite restaurant if you can offer a discount coupon that
they will honor. There is some fr*ee portion to the amount donated on the
restaurant’s part because it increases their clientele list.

It’s time to survey. Allow patience, time, and you will want to schedule this
as a regular routine in your business. Next, plan your services and products to
meet those needs and then generate your business plan around them.

Catherine Franz, a Professional Marketing & Writing Coach, specializes in
product development, Internet writing and marketing, nonfiction, training.
Newsletters and articles available at: www.abundancecenter.com blog: http://abundance.blogs.com

Filed Under: Business Plan Tagged With: business plan, business startup, how to write a business plan, small business

19 Questions to Supercharge Your Business Plan

Whether you are seeking capital for your company or are optimizing your
business strategy, the most important element – particularly for outside
investors – may be your written business plan. You can tune-up and supercharge
your plan using this 19-step checklist. When your written plan firmly answers
yes to each of these 19 questions, your market/product strategy is in terrific
shape plus you increase the odds of attracting investment capital.

If you don’t already have a written business plan – write one! Your business
plan is a blueprint for your whole company. It describes in detail your goals,
the financial and technical viability of your goals, and the strategy you will
use (or are using) to reach those goals. And your business plan is a working
tool – it is a yardstick to measure your progress and a compass to keep you on
course.

Must a business plan be written?

Yes! A plan which is not written usually has not been thought through fully.
And despite what you may have read, it is doubtful that any business ever
attracted capital on the back of a napkin.

Use this checklist as a way to identify where your strategy, as spelled out
in your business plan, needs work. Each of the questions below highlights an
area considered critical to technology investors.

1. Can the key ideas behind your product or service be stated in one or two
sentences? (y/n)

2. Does your company have at least one unique and compelling competitive
advantage, which cannot quickly or easily be duplicated? (y/n) Examples are a
special feature, a cost advantage, a technical refinement, a new delivery system
or a special supplier.

3. Is your competitive advantage proprietary? (y/n) That is, can it be
copyrighted, patented, trademarked or otherwise protected? Can you keep it
exclusive to you?

4. Is your industry segment growing by 25% or more? (y/n) If not, can your
new product dominate its segment? If the answer is no, you probably won’t be
able to generate the kind of financial returns investors look for.

5. Does your product or service create a new market? (y/n) Although generally
positive, this could be a trap – in a brand new market, the potential can be
slow to develop. Lotus Notes created a new category but took years to create
value for investors.

6. Is your market in “early momentum” – the market growth phase where market
revenues have recently taken off? (y/n) Venture investors prefer markets in this
stage because the time-to-create-value is shorter and the growth potential still
large.

7. Is your target market segment 1) tightly defined over a population sharing
common characteristics, 2) large enough to support significant profits, 3)
served by communications channels to reach that market – i.e., trade or special
interest publications, response mailing lists? (y/n)

8. Is your company filling a gap in the market, or do you have a “gee-whiz”
product which you think is so terrific that customers will surely want to buy
it? (y/n)

9. The benefit of your product or service to users is 1) significant, 2)
quantifiable and 3) cost-justified? (y/n). If you provide a benefit which is
important, and you can prove it – there is a much higher probability of
generating sales.

10. Is there a demonstrated market for your product? (y/n) If you have an
existing product, is your customer base expanding? Investors would rather fund
sales and production than product development.

11. Is there wide appeal for your product or service? (y/n) Are there enough
potential customers in the target market that you can earn significant profits,
for a long time? Are there follow-on products to sustain revenue and profit
growth?

12. Does your company have the ability to sell your product? (y/n)
Particularly in companies where the founders have technical backgrounds, a
question to ask is “Who is going to sell your product or service?” What about
outside distributors?

13. Is there an experienced management team? (y/n) Investors would rather
fund a solid team instead of one lone genius with a great idea. The team should
be highly qualified in marketing, sales, finance, and the product/service area
itself. Of course, a demonstrable track record helps.

14. Can you demonstrate a likely return of 5-15 times investors’ capital,
over a period ranging from three to seven years? (y/n) The actual parameters
used by venture investors will vary based on which stage you are in (idea,
startup, development, expansion, turnaround).

15. Is there a clear exit strategy for investors? (y/n) The most common
strategies for returning investors’ capital are 1) going public; 2) acquisition
of your company; 3) new investors; 4) founder’s buyback or management buyout.

16. Have other investors already put money into the company, particularly the
senior management team? (y/n) This reduces the apparent risk, reduces overall
exposure, and shows that management “has its money where its mouth is.”

17. Have you clearly defined a structure for the investment you seeking?
(y/n) The structure should include: who is involved, how much capital is needed,
what minimum investment you will accept, how much equity that will buy – and, of
course, the projected return on investment.

18. Are your financial projections realistic? (y/n) Have you soundly
justified your projected growth rates and other financial assumptions?

19. Have you clearly examined the risks? (y/n) Investors like to know that
you have considered the risks. This is key – can you turn your risks into
opportunities?

Too many no’s? Remember, each “no” opens up an area for you to strengthen
your business. Even if you aren’t seeking capital, each question highlights a
critical success factor – which, when mastered, will increase your profits, your
performance, and your future success.

In order to help you discover hidden value and opportunities in your
existing business, and to make it easier to spot potential problems while you
are just starting out, I’ve created the Discover Hidden Value Business Building Guide. A remarkable aid
to accelerating the growth and profitability of your business, this program of
insight-provoking questions and checklists enables you to rapidly diagnose,
troubleshoot and optimize every part of your business, from marketing to sales,
customer service to product development and finance to production.

About the Author

Paul Lemberg’s clients call him “the unreasonable business coach” because he
insists they pursue goals and take actions far outside their comfort zone to
make more money than they previously thought possible. To get business
coaching tips, tools and strategies like these, visit www.paullemberg.com.

Filed Under: Business Plan Tagged With: business plan, business startup, how to write a business plan, small business management, small business resource

The Inside-Out Business Plan™ — Your Small Business Plan in 10 Easy Questions

Writing a business plan for your Solo Entrepreneur business doesn’t have to
be a daunting project. If you can answer 10 straightforward questions about your
business, you can be ready to go.

The key to success is to answer all of the questions in enough depth that if
a friend asked you to invest in this business, you’d say yes. Most importantly,
make sure you record your business plan somehow…whether you write it by hand,
type it into your computer, or put it on stickie notes on your wall. Keep it
someplace handy where you can refer to it when you are making important business
decisions. And, make sure you review it monthly–or, even better, weekly–and
update it at least annually.

1. Your Dreams: What do you want your business to provide for you?
(think time, money, freedom, who you work with) Be specific–how much money, how
many hours, when do you want to “retire”.

2. Customers: Who are your customers and what do they want/need?

3. Products and Services: What products/services will you provide to
meet customer’s needs?

4. Markets: Where are your customers and what do you know about them
as a group? “Where” might be geographic, it might be what kind of places they
hang out, or where they go to find products or services like yours. What is
their age, income, gender, hobbies, family structure, etc.

5. Your Style: How will you reach customers and what will you say?
Your methods of reaching customers needs to match with where your customers
are–and with a message that they can relate to.

6. Competitors: Where else are your customers likely to get this need
met? Find out all you can about how your competitors price, market, and provide
service.

7. Your Uniqueness: How will your product/service meet customer’s
needs differently than your competitors? Consider how your personal uniqueness
impacts that.

8. Your Abilities: Of the skills necessary to run your business, what
do you do well, and what do you need help with?

9. External Resources: What people/technology/services will support
you in the skills you need help with?

10. Fulfilling your Dreams: How will your business provide the kind of
working environment you desire, both in how much time you spend, how you perform
your work, and how much money you make? Here’s where the rubber meets the
road–make sure you can show how you will sell X amount of product or service at
Y price, cover your expenses, and reach the goals you set in 1. above.

Once you can answer all these questions, have it reviewed by some trusted,
experienced professionals who will give you objective feedback. Consider a
business coach, as one such resource!

Terri Zwierzynski is a coach to small business owners and Solo Entrepreneurs.
She is also the CEI (Conductor of Extraordinary Ideas) at Solo-E.com and the
author of 136 Ways To Market Your Small Business. Terri is an MBA honors
graduate from UNC-Chapel Hill. Terri has been coaching for over 10 years in a
variety of settings, including 6 years as a senior-level coach and consultant
for a Fortune 500 company. She opened her private coaching practice in 2001. You
can reach Terri at www.FastLaneDreams.com.

Filed Under: Business Plan Tagged With: business plan, business plan help, business plan mistakes

Blueprint For A Comprehensive Business Plan

Getting started in a new business requires a lot of work, not the least of which
is planning. Although many business owners claim to little or no formal
planning, even the most intuitive of them have some idea of what they’re trying
to accomplish and how they hope to do it. However all successful entrepreneurs
know that planning is essential to success.

No amount of hard work can
turn a bad idea into a profitable one: The health food store in the meat and
potatoes neighborhood and the child care center in a retirement community are
probably doomed from the beginning.

Planning forces you to think ahead.
Before you rush in to supply a product, you need to be sure that a market
exists. You must also try to foresee some of the problems that might arise and
figure out how you will deal with them.

One of the first steps you should
take toward starting a new business is to develop a business plan, a written
document that summarizes and entrepreneur’s proposed business venture,
communicates the company’s goals, highlights how they plan to achieve those
goals, and shows how consumers will benefit from the company’s products or
services.

Preparing a business plan serves two important functions:
First, it guides the company operations and outlines a strategy for turning an
idea into a reality. And second, it helps persuade lenders and investors to
finance your business.

Although a business plan has a simple and
straightforward purpose, it still requires a great deal of thought. For example
before you open your doors, you have to make important decisions about
personnel, marketing, facilities, suppliers, and distribution. A written
business plan forces you to think about those issues and develop programs that
will help you succeed.

If you are starting out on a small scale and using
you own money, you business plan may be relatively informal. But at a minimum,
you should describe the basic concept of the business and outline its specific
goals, objectives and resource requirements.

A formal plan, suitable for
use with banks or investors, should cover these points:

- Summary
In
one or two pages, summarize your business concept. Describe your product or
service and its market potential. Highlight some things about your company and
its owners that will distinguish it from its competition. Summarize your
financial projections and the amount of money investors can expect to make on
their investment. Be sure to indicate how much money you will need and for what
purpose.

- Mission and Objectives
Explain the purpose of your business
and what you hope to accomplish.

- Company and Industry
Give full
background information on the origins and structure of your venture and the
characteristics of its industry

- Products or Services
Give a complete
but concise description of your product or service, focusing on its unique
attributes. Explain how customers will benefit from using your product or
service, instead of those of your competitors.

- Market and
Competition
Provide data that will persuade the investor that you understand
your target market and can achieve your sales goals. Be sure to identify the
strengths and weaknesses of your competitors.

- Management
Summarize
the background and qualifications of the principle, directors, and key
management personnel in your company. Include resumes in the appendix.

-
Marketing Strategy
Provide projections of sales and marketing share and
outline a strategy for identifying and contacting customers, setting prices,
providing customer services, advertising, and so forth. Whenever possible,
include evidence of customer acceptance, such as advance product
orders.

- Design and Development Plans
If your product requires design
or development, describe the nature and extent of what needs to be done,
including costs and possible problems.

- Operations Plan
Provide
information on the facilities, equipment and labor needed.

- Overall
Schedule
Forecast development of the company in terms of completion dates for
major aspects of the business plan.

- Critical Risks and
Problems
Identify all negative factors and discuss them honestly.

-
Financial Projections and Requirements
Include a detailed budget of start-up
and operating costs, as well as projections for income, expenses, and cash flow
for the first 3 years of business. Identify the company’s financial needs and
potential sources.

- Exit Strategy
Explain how investors will be able
to cash out or sell their investment, such as through a public stock offering,
sale of the company, or a buyback of the investor’s interest. When covering
these points, keep in mind that your audience wants short, concise information –
not lengthy volumes – and realistic projections for growth.

For more
information on starting a business and writing up a business plan, check out the
Small Business Administration Website at http://sba.gov

Keep in mind
that sometimes the greatest service a business plan can provide an entrepreneur
is the realization that the concept just won’t work. Discovering this on paper
can save you tons of time and money.

About the Author

Tanner Larsson is a veteran entrepreneur and the publisher of the award
winning Work At Home Success Newsletter. Subscribe to his newsletter and recieve
4 EXCLUSIVE Bonuses valued at
$276. www.work-at-home-resource-center.com

Filed Under: Business Plan Tagged With: business plan, how to write a business plan, small business management, small business resource, start a small business

Business Plan – Extended

A business plan defines your business, identifies your goals, and serves as your company’s resume. The main components include a current and future (pro forma) balance sheet, a current income statement, and a cash flow analysis of your business. This will help you to allocate business resources properly, to handle unforeseen events, and to make good, solid business decisions. Because the business plan provides specific and detailed information about your company and (as an example) how you will repay a loan, a good business plan wil be a crucial part of any loan application at a bank. Additionally, it will inform your sales personnel, your suppliers, and other 3rd parties about your operations and business goals.

The importance of a comprehensive, detailed business plan can’t be overemphasized. Many important things depend on it: external funding, credit lines from suppliers, management of your operations and finances, promotion and marketing of your business, and finally achievement of your goals and business objectives.

If you are tempted to start a business without having a business plan, you will be very likely in trouble running a successful operation. A business plan is like a blue print of your business. Imagine a builder who starts building your new house without having a blue print. Writing these things down, is not the most fun event a new business owner wants to do. Make sure you spent the time and research to create a solid business plan.

Before you begin writing your business plan, consider four important questions:

What service or product does your business provide and what needs does it try to fill?

How will you attract your potential customers?

Who are the potential customers for your products and/or service and why should they purchase it from you?

Where will you get the financial resources (cash, loan, etc.) to start your business?

How does a business plan looks like?

1. Cover sheet
2. Statement of purpose
3. Table of contents

-> The Business
A. Description of your business
B. Marketing Strategy and Plan
C. Who is your competition
D. Operating procedures
E. Personnel / Staff
F. Business insurance

-> Financial Data
A. Loan applications
B. Capital equipment and supply list
C. Balance sheet
D. Breakeven analysis
E. Pro-forma income projections (profit & loss statements)
Three-year summary
Detail by month, first year
Detail by quarters, second and third years
Assumptions upon which projections were based
F. Pro-forma cash flow

-> Additional Documents
- Tax returns of principals for last three years Personal financial statement (available at your local bank)
- For franchised businesses, a copy of the franchise contracts and all supporting documents provided by the franchisor
- Copies of letters of intent from suppliers, etc. (if available)
- Copy of proposed lease contract or purchase agreement / contract for office space
- Copy of all business licenses and other legal documents (if related to the business)
- Copy of resumes of all principals / company officers

If you start a new business and do not have financial data going 3 years back, you can substitute this with solid statements of your current situation. Described above is the ideal case – adjustments need to be made if necessary. Be detailed – it’ll be to your own favor. Ask your bank so that you can work with their small business specialists. Regular tellers might be friendly, but you want to make sure that you get decent information.

What makes a good business plan?

Is it the length of a business plan? The information it contains? How well it is written, or the brilliance and excellence of the strategy it describes?No.

A business plan will be very difficult to execute unless it is simple, very detailed, realistic and complete. Even if the business plan has all the items listed, a good business plan will need someone to follow up with and check on it, too. The plan also depends on the human elements it’s build on, particularly the process of commitment and involvement.

Successful implementation for your business starts with a good business plan. There are several elements that will make your business plan more likely to be successfully implemented.

Is the plan simple and easy to understand and to act on? Does it communicate its contents easily and practically and is it making sense?

Is the plan specific and detailed? Are its objectives concrete and measurable? Is the plan realistic? Are the sales goals, the expense budget, and milestone dates realistic? Nothing prevents implementation more like unrealistic business goals. Can you achieve your set goals?

Is the plan complete at all? Does it include all the necessary elements to be successful? Requirements of a business plan may vary, depending on the actual context. There is no guarantee, that the plan will work as planned if it doesn’t cover the main bases.

Preparing the business plan has to be an organized, logical way to look at all of the important aspects of a business. Don’t use a business plan to show how much you know yourself about your business. Nobody will read a long-winded, too detailed business plan: not your bank, nor venture capitalists. Years ago, people were favorably impressed by long business plans. Today, nobody is interested in a business plan that is more than 40 or 50 pages long. Don’t waste your time and the time of others by writing a book. Write a business plan that impresses and that is short-while.

Do I need a business plan if I’m not seeking financing?

For your small business to succeed, you need to know where you’re going and how you’ll get there. Creating a business plan forces you to set your own goals, determine the resources you will need to execute your business plan, and to foresee problems that might otherwise broadside you and would prevent you from being successful.

If your business plan is not being used to solicit funding you can create an informal plan only, that serves primarily as a planning tool for yourself and a tool that will keep you on track. An informal plan can also be used to be shown to potential business associates and partners.

How do investors and bankers read a business plan, and what do they look for?

Don’t expect every person you will give your business plan to read it thoroughly. In fact, you really can only count on them to skim it. Investors and bankers know what they’re looking for in a business plan – they want to see a business that will grow rapidly and someday return a handsome profit. Bankers want to see a business that will be able to pay off the loan they are granting. Venture capital firms, for example, expect to receive an average of five times their original investment within 5 to 7 years.

Keep in mind that investors rarely put money into a “product” — they invest in a business. Many great products have floundered because the inventors did not understand how to get people to buy them. So be sure to show that you understand how to market your product or service. If your banker does not understand your business model, he will not grant you the loan you are looking for.

How long should my business plan be?

30-40 pages should suffice. Anything longer than that and you risk alienating a potential investor, or you force them to skim through the document rather than read it. You won’t be impressing anyone by creating a 200-page document – what’s contained in the plan is much more important than how long it is. The more concise, detailed, and readable your business plan is, the more focused your business will appear. Focus on those details that tell your business’ story, that set you apart from your competition, that make your business appear to be a good, solid financial investment, and that show you will be profitable.

With the fast changes taking place in industry and society, how can a business plan be helpful if it is quickly outdated?

A well written and researched business plan will not only prepare your company for today’s business and market conditions but tomorrow’s unforeseen events. All business plans should have a contingency section to accommodate for the future. Your business plan is a plan that will not just sit on the shelf for 12 months but will always be updated when new market conditions or strategic changes take place. Plan your changes thoroughly. Running a business requires patience – making changes too often and to fast might result in your business going down faster than you can re-write your business plan.

Do the readers of my business plan need to sign a non-disclosure agreement?

A non-disclosure agreement can raise red flags with your intended audience. A seasoned banker or investor is bound by client confidentiality and may find a NDA insulting. Secondly, if the business needs to protect its ideas and concept at this stage of the game than there may not be any barriers to entry for others to enter the market. A simple confidentiality clause at the front of the plan should suffice. If you are selling your business or if you are seeking a strategic alliance/partnership, a non-disclosure may be necessary. If in doubt, consult with your lawyer.

Filed Under: Business Plan Tagged With: business plan, how to write a business plan, small business management, small business resource