start up’s – business plan, opinion
There sure has been quite a bit of chatter about business plans as they pertain to “start up’s”…
Should I write one or not write one? That is the question.
I think these new found entrepreneurs that say, “You don’t need a business plan, it’s a waste of time” are completely smoking crack! Ok, I get it…some people out there are very charismatic & simply make stuff happen, and that is pretty awesome for you 2%er’s. The other 98% of us are stuck dreaming, verbalizing, creating, critiquing, advice finding, revising business planning folks.
Plain & simple, YOU MUST PLAN! This is a huge benefit not only to getting your doors open, but for future growth, money raising potential and having a compass/vision to help guide you through the crap of any start up.
Another genius statement I heard, “Only focus on current actions & what your venture needs right now.” What, planning for growth or future changes aren’t important? Off the cuff (no plan) is a fine way to live & start a business, hell, you may even be successful for a while, but when you hit a certain level your knowledge runs out & if you are not in line with a vision…start to kiss the honeymoon goodbye!
“Real entrepreneurs don’t write a business plan, they simply make the right action at the right time” really?
Luck is when preparation meets opportunity. That is the purpose of a business plan; succinctly collecting your thoughts, being ready for opportunity & making it happen for yourself.
Business plans are not just some crazy “have to do” that MBA’s state is the direct path to success. Business plans make you think about who, what, where & how; giving you a helpful road map to your dream.
A few quotes I have heard in some form or fashion:
“Five-year financial projections will assist investors with making decisions about your business and help you understand how much funding you will need for startup & if you are able to be profitable.”
First, yes, financial projections are good to have and all this really shows is you know what the heck you are talking about. You will most likely know the industry cost percent standards allowing you to work backwards forming the most accurate projections possible. And, once you get past year one or two they become even more arbitrary, because no one I know can predict the future, not yet anyways.
Also, take your projections and do several things:
- cut your revenues in half
- multiply your expenses by two
- extend the timeline for actually opening by 6-9 months
- extend your timeline for seeing a profit by 2 times
- if you still have cash leftover to stay in business, you might have a chance covering all the crap that cost money which you forgot to include
“Businesses don’t plan to fail, they fail to plan”
I couldn’t agree more. I am a believer that had we not planned as much as we did the economic down turn of 2009 would have put us in the dirt. Spending about two years, allowed us to have already hashed out many things that would have been asinine to try. Also, our investor’s believed in us enough to extend extra lines of credit and/or loans because they could see real & future plans to gaining their ROI.
“Adjust your business plan as needed, be sure to not stray far from your original idea.”
About half right. Once again, adjust your plan as needed & if your vision changes make the appropriate changes in the business plan for moving forward. This is not a document you will read daily, probably semi-annually at best. But writing down plans, goals & execution strategies are what make them real, not leaving them in your head!
Potential investor meetings where we presented the business plan were some of the MOST educational periods of our lives. We had tough questions to answer, many we had no clue, but these made us re-evaluate how we approached everything. Was our plan sufficient, did we believe in ourselves to know we had something great, were we on the right track…?
If planning is so bad, why have a budget? Don’t sales & numbers change as constant as everything else? ABSOLUTELY! The point is you need to have something to shoot for.
Why then do people always state, “Write your goals down.” You know you will more than likely not look at them again for some time. The cosmic flow of life begins to take shape by taking your subconscious ideas & putting them down consciously, you start to believe & perform actions to bring it to fruition. Sure, nothing ever goes as planned, so what! Vision is not about being perfect; it is about striving to make things better, through key points: plan, focus, act, practice & deliver.
Change is the only constant in life and if you have trouble accepting this you may be in trouble.
In the end, writing a business plan may or may not be for you. I am a creative thinker & dreamer, so taking a dream, verbalizing it, collecting some data, envisioning the outcome & then disciplining myself to sit down & write has been a very powerful life altering practice.
So write or don’t write. You will make the call right for you!
PS – I do not have an MBA
In: start up's · Tagged with: business plan, entrepreneur, new business, start up's
