Monday, August 12, 2013

The Business Plan You Really Need

    Bankers and investors, even "angel" investors, are constantly fussing, "show us your business plan." It can  be annoying and embarrassing when not only do you not have one, you're not at all clear as to how you would prepare one.

    The one person who is the least likely to ask you for a business plan is you, yourself. Why? Because you "know" your plan -- or, more commonly, you know you don't have a plan and are hoping to stumble your way to success without one.

    Why all the fuss about business plans? Why do bankers and investors require one? And why, of all things, would you want one for yourself when you're not trying to borrow money?

    The answer is simple. Preparing a business plan forces you to clarify your thinking, bring your goal into sharp focus, and plot a realistic series of steps by which you can reach that goal.

    When your thinking is muddy, trying to write even the most basic business plan can be painful because it dashes your fantasies of quick, easy success and forces you to take an inventory your true resources.

    I'm working on a business plan now for a small company that would be happy to make even modest sales in a small market but, thanks to this business plan, they are forced to confront several obstacles which they find troubling. These obstacles are troubling largely because they lack sound research that will tell them whether these difficulties will be fatal or whether they will amount to nothing.

    The research they need to make this determination will not be expensive, nor will it prove difficult. But to acquire the facts will require a plan within a plan, which in this case will amount to next to nothing.

    But the point is that, had they not decided to prepare a business plan, they would not have put their finger on a problem and the need for facts to explore this problem and guide their planning.

    What would they have done minus this business plan? They would continue to dream while worrying about an obstacle. The project would never get started.

    Good business plans aren't fussy stuff to impress bankers and investors. The person that benefits most from a good business plan is you. A good business plan, perhaps no more than a page or two, can hang on your wall and be your daily step by step guide toward accomplishing your goal -- which is success.

1 comment:

  1. I've expanded on the Business Plan theme with an outline of how you might prepare one for yourself, for your own perfume business. Here's the link --