Business Plans – Stop Wasting Your Time!

“Failing to plan is planning to fail!” was a phrase commonly heard as far back as high school when speaking with my career counselor.  As cliche? is the statement is, most business leaders will suggest that there is a great deal of merit to it, to the extent that most business leaders either a) have started thinking about writing a business plan, b) have started writing one or c) have one tucked away on a shelf that they haven’t looked at, ever.

Business plans take too long to write, they are more of an academic process, they are impractical, they are only used to raise money when starting a business and most good business leaders don’t need one, anyway, right?  While there have been many the albatross thrown around the neck of the business plan, we hope to give you new perspective on creating a business plan and hope that you will engage in one for your business.

In this issue of “Had an Aepiphanni, Lately?” we are going to discuss the justification of the business plan, or why the heck we need one, anyway, and how you might implement one into your daily business without it becoming a burdensome exercise.  Topics we will cover include:

The Business Plan: Why?
The Business Plan: Types
The Business Plan: How?
The Business Plan: When?
The Business Plan: Why?

Your business plan is a way to get the idea or vision for your business down on paper in order to determine:

if it makes sense, as in, does it fill a specific want or need and can that need be met, if it is feasible, as in, are there people or businesses who would be interested in buying your product or service at a price that works for you and them explore potential risk, how to avoid some and how to manage others,  costs of starting it and keeping it going and financial outlook.  

Additionally, simply going through the process of building the plan will provide you with a great deal of information you will need while running your business.  Additionally, as the business grows, you will want to use the business plan to help guide you in your future planning and decision-making processes.  Finally, if you expect to raise money using investors – whether friends and family or through venture capitalists, you will need a good, strong business plan.

The Business Plan: Types

The first thing you’ll want to do for your business plan is to determine what it is going to be used for.  Basically, there are four types of business plans:

Startup plans – sometimes this will be more of an overview of the business with expected sales and expenses, discussion about the product or services, the market and marketing.  These plans can be very short (10 pages) and effective for the startup phase of the business.

Operational plans – that focus on how the business will operate, heavily focused on processes, systems and people.  Ideally, cost analysis of the various processes and systems should be included, but often, current financial information and projections are used in the plan.  These can be equated with business architecture and strategic planning.

Presentation plans – these plans are used to attract partners, donors, executive teams and investors.  The key, here, is that this plan is used to attract them. Rarely will they be the final piece of information required.  In this type of plan, we focus on outcomes: the product and why there is a great need for it in the marketplace, what an investment will do to bring the product or service to market and what type of return one might expect as a result of investing or partnering with the company.  It will normally include a lot of visuals and is, essentially, a marketing piece.

Investor Grade Plans – these are the all inclusive business plans that combine all three of the other plans, with the addition of exploring risk.  This is the epitome of a marketing and investing tool that potential investors will try to tear holes in (versus trying to justify) to determine whether or not they will invest.  The executive summary, alone, needs to be powerful enough to engage potential investors to read further.  Financial plans need to extend three to five years.  This type of plan requires the greatest investment in research and financial planning of the four plans.  It will be the authority on operating the business.

The Business Plan: How?

Many people begin their business plans with a simple template.  Templates can be found all over the internet, in books, through SCORE (Service Core of Retired Executives) the SBA (Small Business Administration) and the SBDC (Small Business Development Centers).  You can take courses on how to develop the plan, or you can work with a consultant or business plan expert (Note: I emphasize with. For your business plan to be practical, you need to fully understand what is going into the plan, why it’s there and what to do with it!).  

The most important aspect of the plan, however, is that it needs to work for you and your business.  If you are a visual person, you might create a plan that is pictorially based.  If you are a task-oriented person, you might use bullet points to describe many areas of the business.  If you are a story teller, create a story, first, before even looking at a template.  Templates can be intimidating given all that is required.  Take it one step at a time.

The Business Plan: When?

When?  Your business plan should be your road map.  How often do you look at your road map when you are going somewhere you’ve never been?  Hopefully, you will look before you begin to veer off course.  Does this mean that you need to look at the whole thing, from beginning to end each and every day?  Not practical.  So when do you look at it?

The easy answer is: depends on your industry.

The better answer is – it’s too big to eat all at once.  Just like eating an elephant, you need to break it down into manageable pieces.  That means that you will want to put the marketing plan in one folder, put the SWOT analysis into another folder, your financial information in another, your processes in another, etc.  Your business plan does not necessarily need to be a single three inch thick document.  

With the plan separated, it becomes much more practical to use and update.  You might do marketing every day, but do your SWOT only once a month or once a quarter.  Ideally, you’ll manage your finances regularly and can look, at any time, to see where the business is financially.  As you update any area, stick it in the appropriate area.  Once a year, you may wish to pull out a whole section, or the whole plan section by section to review and make plans for the following year.

In Conclusion:

Your business plan should be a living set of documents that can be practically applied to your business’s every day operations.  Just the fact that you’ve invested so much time and money into the development of it should encourage you to squeeze every bit of that money right back out of it, even beyond the investment stage.  Keep in mind that creating the right type of plan and creating it in a way that makes sense for you and your business is a major determinant in the success of your plan, and that implementation of the plan is not a once and done deal.

Small Business Finance the Smart Way

Are you a small business owner? If you are, you’ll know that running a small business is one of the most difficult things you’ll ever do in your life. You’re the company’s spokesperson, owner, founder, advertiser and investor. You are its inspiration. It is your livelihood and your passion. And like all passions it is all consuming.

It has you crunching numbers when you should be sleeping. It has you sketching out ideas on napkins in restaurants when you should be eating. But like any love affair the irritations are worth it. You know that almost nothing in your life can match the highs that your business gives you. So stick with it! Give your business all your heart and soul. But be sensible when it comes to your cash.

Business Finance.

Starting your business can be incredibly costly. Buying the machinery, renting the premises, purchasing the advertising space… well you get the picture, you’ve been there. You are also probably aware that the cost of kicking your business into life is so high it can affect your businesses ability to grow later on down the line.

You’ve established yourself as a great business; you know you have the ability to expand and to grow. But you just don’t have the cash to do it. But what is the best way to get that much needed cash injection? You don’t want to be taken for a ride. This is why you need to know about business finance.

Small Business Cost.

The first thing to do when you start investigating small business finance is to look carefully at what you want to achieve. Having clear goals is one of the basic rules of success in business. If you are going to borrow money to support your business you must have a clear aim in mind. That way you can easily track the success of any investment and see how much, making your small business grow will cost. So, determine what you want. Are you purchasing assets, such as land or machinery, or stock? Or are you looking to improve your market position through advertising, or expand into new markets? Whatever you’re doing be clear about your goals.

Small Business Finance.

There are two types of small business finance available to you. The first is the more traditional and common form, known as ‘debt finance’. This involves your company lending money from a financial institution, usually your bank. There are up sides to this deal, you get your cash and you keep all your business. You do have to pay more back than you borrowed in the first place, with the onus on you to repay as soon as possible.

However, if you have clearly identified a use for your money this should present no problem to you and allow you to expand quickly. This is why it is the route taken by the majority of small businesses. If you fail to pay back the money you have borrowed however the consequences are severe, as part of the agreement will involve collateral. Often, this could be your house.

A less common option is that of ‘equity finance’. Ever seen the TV show Dragon’s Den? Then you’ll know what I’m talking about. Equity finance is when an investor gives you the cash you need and in return you give him a share, or a stake of your business. As the investor has no assurances, unlike the bank, he or she requires a much greater pay off if things go well. They want some of those profits! However if things don’t work out, you won’t be sleeping in the streets!

Your Future.

So there are plenty of ways you can offset your small business cost. Small business finance is easy to get if you pitch correctly and your business is heading in the right direction. Whichever mode of business finance you choose make sure you keep following the dream and your passion might end up making you millions.

Tips on How to Choose a Good Business Lawyer

Finding the right attorney for your business can be a daunting task. Whether you are new to the marketplace and are in need of a lawyer for your new business or you are in the market for a new business lawyer, the issues remain the same. You need an attorney with the right experience and who is attentive to your business needs.

Ultimately, you should ask yourself, “Do I trust this person with my business?”

To help you answer this question, below are a few issues and questions you should address in evaluating whether or not a prospective business lawyer is right for your business:

Check out the lawyer’s background.

  • It should go without saying, but you need to check with the local bar association to determine if the attorney is currently licensed to practice law and whether he or she has had any major disciplinary actions.
  • Don’t be afraid to ask for referrals.
  • Find out what is their area of practice.
  • You need an attorney who spends most of of his/her time practicing business and commercial law.
  • When dealing with the health and future prosperity of your business, you want a specialist who can quickly diagnose and efficiently find the solution.
  • Ask how much of their practice is devoted to business and commercial law.
  • What areas of business law do they specialize in? In what (and how many) other areas do they practice? – are these areas complementary to your business needs?

Assess their experience and knowledge.

  • Make sure your attorney has the right experience and knowledge of your industry.
  • You need a lawyer who has significant experience with companies like yours so you do not have to pay for the attorney’s learning curve in getting up to speed on the legal issues affecting your industry.
  • On the other hand, you should want an attorney who is willing to invest the time to understand your legal issues and the challenges facing your business, rather than provide a cookie-cutter solution.

Don’t forget relationship count!

  • While most of your communication with your lawyer may occur on the phone, through email and mail, a face-to-face meeting is still crucial in an attorney-client relationship.
  • You need to meet your prospective attorney in person. You can learn many things from a face-to-face meeting that do not communicate well over the phone or email.
  • Be wary of any lawyer who is unwilling to meet you in person or insists on a “retainer” before your initial meeting and/or any discussion about your business, your particular issues and the scope of their engagement.

Personality can play a key role in how effective a lawyer will be for your business.

  • You need to be comfortable with your legal counselor.
  • Would he/she mesh with your executives, managers and your team (i.e., your accountant, financial advisers and other advisers)?
  • Is he/she the right fit for the job?
  • Do you want a team player? Or do you need an independent person to review your business and keep your managers and employees in check?
  • Are they aggressive and outspoken? Or they merely combative?
  • Do you want a risk taker? Or do you want someone who is conservative and takes the safe and secure route?

To further help you in your search, below is a list of some of the key characteristics of a good business lawyer (in no particular order of importance or relevance):

  • An Advocate for your Business: An attorney needs to be supportive and not just sympathetic to your cause. You do not want a “yes” man. A good attorney is supposed to tell you where you may be wrong. Can the attorney be straight-forward with you?
  • Good Business Judgment: Are you comfortable with their business judgment? Do they seem to exercise reasonable and sound business judgment? Or are they too theoretical, impractical and/or out-of touch with your business reality well-thought ideas and reasons.
  • Readily Available: Do they have adequate time to take on your matters. Make sure to get a commitment from the attorney.
  • A Great Communicator- No “Legalese” please: Your attorney must be able to explain to you even the most complex issues into terms you understand. Your attorney is supposed to find solutions for you, not mystify you.
  • Foresight & Proactive: Does the attorney think of ways to help you and your business? Do they seem to understand the problems you are likely to have? Do they have a plan to avoid likely problems?
  • Exudes Professionalism: Are they organized and handle themselves with professionalism? Are they respectful of your time – were they on time?
  • Have Resources – Will Travel: Does he/she have the resources and connections you may need to support your business? Do he/she know the players in your industry? Do he/she have contacts within your industry? Does he/she have contacts with your customers or prospects? Ask about their affiliations with accountants, financial advisers, bankers, and other professionals. Can you leverage their resources, connections and referrals?

Finding the right attorney for your business does not have to be overwhelming. With a bit of preparation, you should be able to find a lawyer with the right experience and who is attentive to your business needs.