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When Opportunity Knocks, the Business Plan Can Answer

Business plans can be viewed in a lot of ways, but in some cases they represent a plan to answer an opportunity. A business opportunity is basically a packaged business that you can start but is not necessarily a franchise. Unlike a franchise, a packaged business is fully controlled by you, and the seller has no say in how you operate your business. Once the business sale is completed, the buyer is on his or her own. The business purchase includes buying equipment or specialized materials and then establishing whatever type of operations you want.

When a business opportunity comes along, it is important to thoroughly evaluate it, of course. There are unfortunately a lot of scam artists who promise big returns if you will only make the initial investment. A good example is a cabinet company that promised business owners enormous returns for redoing cabinet faces. An investment basically bought you a manual and a half day of training. That may be enough for some people, but for others it was a plan for failure. The company was taking advantage of people desperate to get a side business started.

Review From All Angles

The business plan template can be used to ensure you evaluate the business opportunity from every angle. Naturally, you want to ensure the business is legitimate, follows state laws and regulations, and can support its claims with a list of others who have bought the opportunity. If it passes the first review, then use the business plan template as a guide for further evaluation.

For example, in the market strategies section you would be guided towards doing research on the niche market the business opportunity would target, the type of strategies that would be most successful, and the competition. The template can help you make sure that you consider all the important business factors before investing.

Evaluating a business opportunity after it has been purchased is not a good idea. The evaluation needs to be thorough before the opportunity is purchased. The business plan template is the best guide you can use.

Browse www.funded.com for more advice about getting your business funded.

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Business Plans Begin With a Mission to Thrive

Business plans are meant to be adaptable plans for thriving, not just surviving, as a company. Yet, according to famed Harvard professor John Kotter, 70 percent of business initiatives meant to bring organizational change will fail. That is an impressive number because it means efforts to adapt to a changing marketplace are failing. There is a disconnect between the business plan founded on a mission and the real world.

The problem is often one of losing sight of the company mission and failing to plan. The mission statement represents the starting point for the direction of the business plan and captures the essence of business purpose. It has a philosophy underlying it that does not change. Philosophies are encompassing, so the mission statement is a reflection of the nature of products or services sold, potential for growth, pricing strategy, customer service, role in the community, competition and much more.

On a Mission to Fulfill a Mission

The business plan needs to be developed so that each and every section drives the business towards fulfillment of the mission. A change initiative is merely a strategy for keeping the business on track to fulfill the mission. Leading change requires first turning to the mission statement and the business plan. A business that needs to change must be able to communicate a sense of urgency throughout the organization because staying true to the mission statement is necessary to thrive. If a change initiative is needed, it means the business has gotten off course from its mission and its vision.

The business plan goals and strategies may need to be revised, but that should always be a step in the change process. In fact, business plans can serve as the guide for change as each section, from the Executive Summary to the Financial Statements, are reviewed in light of the need for change. Leadership will identify specific strategies for incorporating change and then communicate the revisions on an organization-wide basis. The change process must be empowering and encompassing, meaning employees at all levels should be embraced as change agents.

Business plans begin with a mission statement and then serve as a living breathing document. Leading organizational change is not always easy, but it can be impossible unless there is buy-in to the mission and the business plan. The strategies used to get that buy-in can vary, but staying on message cannot.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Planning for Change in Business Plans

Business plans are not etched in stone; yet that is exactly how some businesses treat them. The business plans are written and then put into a proverbial drawer where they never see the light of day. One day the plan is dusted off, updated for the Board of Directors, and then put back into the drawer. This does not make sense after so much time and effort has been put into developing a plan that is supposed to establish a clear path to success.

Viable businesses never stand still. They are movers and shakers as they interact with customers, develop new products and services, and adapt to good and poor economies. When major changes happen that affect your business, it is like a time warp because everything changes from that point forward. Change is always imminent today and largely because of technology. Businesses can enter the marketplace faster and roll out a marketing program quickly on the internet.

The business plan can quickly become an anachronism if it does not plan for change. This doesn’t mean doing multiple business plans addressing all the what-if scenarios. However, change should be built in to the business plan process. First you develop a business plan based on the most sensible goals using current knowledge and expectations for the future. You can include a decision tree analysis section, if desired. However, you plan to change by simply doing an honest and regular review of the developed business plan.

It is important to have the same groups involved in the original plan development also participate in review sessions. The business plan may need to be revised, but you have identified where and how which is good strategic management.

The real issue is whether management can develop the discipline needed to make sure the business plan is regularly reviewed. Developing business plans should not merely be an academic exercise. It needs to be an important management function.

Browse www.funded.com for more advice about getting your business funded.

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Adding Internet Marketing to Your Business Plans

Incorporating internet marketing in business plans has become an imperative as opposed to an option. That probably became true when even the large storefront businesses began to do internet marketing. Judging by the number of websites, online accounts and emails sent with discounts for online shopping, the internet is playing a larger and larger role in all business models.

The implication is that internet marketing should not be a separate strategy. It needs to be integrated in the total marketing plan. It should not be a standalone subsection in the marketing plan. It needs to be weaved into the various marketing efforts, in addition to be being a unique effort.

For example, the business plan can include the development of a website and a discount campaign. However, the offline marketing efforts need to incorporate the website and the discount campaign also. For example, direct mailing of advertisements can be integrated with online marketing by developing the tactics the big department stores have successfully developed. The offline direct mail advertisements encourage online shopping by offering discounts, and the online emails encourage offline shopping with special discounts.

Of course, you can have a description in the business plan for specific internet only strategies. For example, you can discuss strategies for obtaining client leads and set goals for the lead-to-customer conversion rate, the number of transactions and the targeted average dollar sale. Yet there is still integration needed with offline marketing needed. Offline marketing will play a supporting role in driving people to the website to find the online-only discounts.

There are a number of online marketing strategies that can be addressed in business plans. They include developing the business website, participating in social media and blogging, and so on. The important point to keep in mind is that the marketing plan needs to be a cohesive integrated plan and not a disjointed set of offline and offline activities.

More detailed information and useful advice can be found at www.funded.com.  Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions.  If you need to access a vast network of business people, entrepreneurs, partners and service providers to help you start, finance and run your business, check out our website.

 

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Business Plan for Buying a Business

Business plans are developed for new businesses and when buying an existing business. Sometimes, entrepreneurs want to buy an ongoing business because they believe they can grow a business with new ideas and approaches. When buying a business, it’s still important to write a business plan to ensure that all aspects of the purchase have been considered and future growth is planned. In many cases, the business plan is also used to attract investors like venture capitalists or angel investors.

There are advantages to buying a business and those advantages should be highlighted in the business plan. The first advantage is the fact the company already has a financial record. That can make it much easier to attract investors if there is less risk of business failure. However, if financial projections are made by the current business owner, it will be important to verify they are not inflated. You will want to develop your own sales and expense projections for 5 to 10 years based on plans for business expansion.

Another advantage of buying an existing business results from the knowing the market already exists for the business. Current customers are identified and market proven, making it much easier to identify potential growth areas or new niche markets. Since the basic customer profile is already developed, you can build on it rather than starting from scratch.

It’s also good to enjoy the advantage of having access to insider information. Since you’re buying the business, the current owner is going to be willing to share a lot of information you would have to research if starting a new business. This information can be incorporated in the business plan, making it clear that the plan is based in solid facts and information.

Buying a business can give you a competitive advantage because the name, location, products and services, and customers are already in place. The business plan goals are to develop that competitive advantage to attract investors and to plan growth. It’s always nice to begin from a point of success.

Browse www.funded.com for more advice about getting your business funded

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Know Why Businesses Fail So Yours Does Not!

One of the most common reasons for businesses failing is failure to write a business plan. When an entrepreneur fails to plan, the chances are good that even growth can lead to serious business problems. How can growth lead to problems? It’s not growth per se. It’s when growth is too rapid and the business is unable to meet demand that causes small business failure.

Business growth must be managed. You can accept a half million dollars of customer orders, but if you can’t meet the demand in production or delivery the business will quickly get a bad reputation when unable to deliver goods and services as promised. Growth should be carefully planned so that resources are always available.

The business plan can help company owners and management avoid the most common reasons for business failure. In fact, knowing the reasons and then addressing them one by one in relation to your own business can help you avoid the pitfalls a new business typically faces.

Top of the list of reasons for business failure is lack of experience. The business plan includes a section on business management for a very good reason. Investors will want to know if the management is qualified and experienced. Even if you aren’t looking for an investor, it’s still important to identify the skills and competencies of key personnel. If gap exists, you’ll know it’s necessary to bring other talent onboard.

Lack of capital is another reason for business failure. The financial analysis needs to address money needed now and for planned growth. The keyword is ‘planned’ because unplanned growth can cause inventory, cash and personnel shortages.

That brings us to one of the most important advantages of a business plan. The elements of a business plan are integrated. For example, investing too heavily in assets can lead to a cash shortage which leads to poor customer service and lack of operating funds. Lack of management experience can lead to poor decisions that lead to marketing mistakes. The integrated nature of the business plan is precisely what makes it so valuable as a planning tool. No one starts a business expecting it to fail. Knowing why businesses fail can help you avoid a business failure. Plan to succeed in the business plan.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Preplanning the Business Plan

The Small Business Administration contracted with William B. Garner, a Spiro Professor of Entrepreneurial Leadership at Clemson University and Jianwen Liao, Associate Professor of Strategy and Entrepreneurship at the Illinois Institute of Technology to study pre-venture planning and entrepreneurs. Published February 2009 by the SBA Office of Advocacy, the article titled Are Planners Doers? Pre-Venture Planning and the Start-Up Behaviors of Entrepreneurs reports some interesting findings that all entrepreneurs should know.

First, the professors reported that, indeed, “…early formal planners are doers. We believe that challenging prospective entrepreneurs to accomplish a formal business plan early in the venture creation process will likely enable them to engage in additional start-up behavior that could further the process of business creation.” In other words, the business plan is informative and motivating.

The reasons given in the report for the importance of business planning include:

  • Entrepreneur can identify what he or she doesn’t know
  • Early identification of needed resources and when they will be needed
  • Identification of specific problem solving actions
  • Identification of actions needed to attain goals
  • Ability to communicate objectives, purposes and activities to others
  • Assessment of accuracy of business assumptions concerning resources, knowledge level, potential customers and beliefs
  • Reduction in organizational delays
  • Reduction in delays in acquiring plant and equipment, and goods and services
  • Keeps entrepreneurs on track
  • Provides benchmarks

In fact, studies show that even the presence of planning benefits entrepreneurial success. Presence refers to the whether a business plan is completed, while formality refers to a documented business plan. A written formal business plan was found to significantly influence a positive business start.

A lot is written about the benefits of writing a business plan in general terms. It’s good to know that studies of specific companies backs up the generalities. A business plan is a tool for success any way you look at it.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.

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Keeping the Business Plan Focused on Purpose

Business plans are used for many purposes, and that purpose can influence what is emphasized in the plan.  Every business plan has sections that include the executive summary, business description, marketing plan, competitive analysis, development plan, management and operations plan, and financial statements and plan. It’s what goes into each section that must specifically address the purpose of the plan.

Business plans are as important for startup companies as they are for the large corporation ready to expand. Small and medium-sized companies, as well as the corporate giants develop business plans because they provide benchmarks for measuring progress. That’s one of the purposes then for developing a business plan – measuring actual results against strategic goals. Each section will establish periodic goals like number of marketing campaigns to run in a year, sales growth projections and net profit goals.

Another reason for preparing a business plan is to raise money. In that case, you will need to develop a well honed mission, clear objectives and goals and an executive summary that explains the type of business being started, the amount of capital needed and the type of financing. In addition, the marketing and financial plans need to be crafted so that they make sense in terms of the market and competition. This business plan will be used to get the attention of investors so you will want to show that the business will be able to make money or grow sufficiently to service the debt. If the investors will be equity partners, then the business plan will have to indicate how the company will be able to secure the investment and produce the desired rate of return.

A third reason business plans are developed is to attract people who aren’t investors. For example, a business plan can be used as a marketing tool when pursuing new customers representing large buyers. It is also used to attract suppliers or exceptional staff. The sections of the plan these people are most interested in needs to be fully developed. For example, large suppliers want to know you will have the right kind and volume of business and that plans for growth equates to supplier success also. Executive talent will read the business plan to discover information about corporate culture and the growth agenda.

In other words, a business plan is not just for attracting investors. It’s for all businesses at any stage of development and is used for multiple purposes.

Browse www.funded.com for more advice about getting your business funded.

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Once Upon a Time: Telling a Story in the Business Plan

If you could start a business plan with “once upon a time”, what would follow? Once upon a time there was a business that offered a value proposition to customers. Or maybe you would write that once upon a time there was a business with a compelling story and investors couldn’t wait to read the details.

A business plan is a business document, but it’s also your chance to tell a story. That story is the tale of your business brand and what you offer in the way of products and services that create marketplace passion and excitement. Unfortunately, many business plans present the minimum amount of detailed information as required, but they lack enthusiasm. When the plan is presented to potential investors, you can bet they will notice this lack of excitement too.

Let’s face it – a business plan has to create a sense of fascination in the products and services. The story you have to tell should echo what customers are saying about the marketplace and their problems and how you will solve those problems. It’s a never ending story about what makes your business idea different and your products or services special. The story characters are the management team and the customers. The plot is all about turning authentic passion for products into a value proposition for consumers. What makes your story unique? Interesting? Fascinating? Remarkable?

A dry business plan that meets minimum requires but doesn’t share the entrepreneur’s motivation for starting or growing the business is doomed to enter the annals of boredom. That’s no way to get investors interested and especially innovative angel investors or venture capitalists looking for exciting new ideas. The story should not be invented or fictional. It must be authentic because it’s your story, your business and your products.

Once upon a time there was a successful business…

Browse www.funded.com for more advice about getting your business funded.

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Getting Competitive in the Business Plan Competitive Analysis

Every business has competitors which is why the business plan includes a section that presents a thorough competitive analysis. The analysis considers businesses in the same industry your business will be operating in and evaluates similar products or services. It also looks at the features of the competitor businesses. The goal is to pinpoint the strengths and weaknesses of the competitors and then position your business in the industry and marketplace.

A common mistake new entrepreneurs make is telling themselves there is no competition. In the excitement of starting a business, they fall prey to the belief that their products or services are so unique there are no other options for consumers to choose among. One point to keep in mind at all times is every business has competition, and you need to know your competition well.

The competitive analysis in the business plan considers a number of factors for multiple businesses. It’s a good idea to analyze at least 5 businesses to ensure your research is thorough. The factors include product and services prices, the quality level and the product lines.

However, the competitive analysis also considers how your competitors market their products and services and the structure of customer services. The more information you know about a competitor’s organizational structure, sales team, type of facilities, management, and culture, the more effectively you can compete. The analysis should also be done from different perspectives based on market segmentation.

Often, the completed competitive analysis developed for a business plan uncovers opportunities for marketing, product and services differentiation, customer service or new distribution channels. So don’t look at the competitive analysis as a tedious research process. Instead, consider it time well spent learning how to succeed. Every business has competitors and should know who they are, what they’re doing and how they’re doing it. Then your business can do it differently.

More detailed information and useful advice can be found at www.funded.com Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our website.