I’ve had a few people ask me recently, “just why is it so important to have a business plan?”
Well, a business plan serves two crucial core purposes; it provides a financial validation and it also serves as a roadmap to keep you on track all year.
By financial validation, I mean that your plan gives both you and any outside funding institution you may need for loans etc. a strong indication as to whether your business venture will be a success. If you are doing a business plan for this purpose you would add in specific detail regarding how you run your business and whether you will get a return on any investment that, say a bank, will loan you and of course that you are financially viable enough to be able to afford loan repayments.
The second core purpose, the roadmap, is the area I will be looking at in more detail as this is what most small businesses (who don’t necessarily need financial input) think that a plan is not a necessity. And some small businesses manage completely fine without a plan, but I feel it is important as it lays out your action plan; details all the milestones and successes you have established and gives timescales for when you expect to complete certain tasks. It gives you a clear path to follow and keeps you focussed on achieving the goals that you have set for your business.
So, I’m going to focus on what a business plan does for your business and why it’s important.
To demonstrate that you’re serious about your business. This just puts it down in writing that you are committed to building your business and how you’re going to go about making it a success.
To ascertain your business goals or milestones. Your business plan will make you think about what you want to achieve with your business and where you see yourself in a year’s time… in five years’ time or more. You can plan not only your long-term goals, but also some quick wins and short term plans. They are significant events that you want to achieve, such as building a website, launching new products/services, producing a brochure and also things like getting your first 100 or 1000 followers on social media.
To understand and know your competition. A business plan forces you to look at your competition – analyse how they work, what they do that makes them stand out in the crowd, look at their products and how they advertise them, package them etc.
To understand and know your customers. Planning makes you look at your customers; who are they? Why do they buy your products and why do they buy when they do? Do they belong to an average age group or geographic region? An in-depth customer analysis will help you understand what makes your customers tick and how you can better serve them and give them what they want.
To assess the feasibility of your business. Is your business viable? A feasibility study involves researching your target market and your competitors and will let you know if your business venture is likely to be a success.
To determine your financial needs. Do you need to raise money to buy stock and how are you going to do this? Are there training opportunities for you, so you can learn more about what you do, that incur a cost? How will you factor this in? If you need a big financial injection, you will need to look at loans or investors…your plan will then need to be very specific around how you will be able to afford this kind of investment and what your return will be.
To reduce the risk of looking at the wrong business opportunity. If you do all your research, you will be able to clearly see if a particular business opportunity is going to be feasible, if there is a market for your products/services or whether an alternative route/opportunity might be better for you.
To push you to research your market and really get to know it. Researching your market will help you understand the latest trends in your particular area. Is this market growing or receding? What is the biggest threat to your business/industry? What is the size of your target market and how do you get your products/services in front of them? Your business plan will help you gain a greater understanding of the ‘what, when, where, who and how’ of what your business will face.
To pinpoint your brand. Creating a business plan makes you focus on what your brand is; helps you describe your business succinctly and decide how you will position your brand to your customers and target market.
To measure the success of your business. This is the bit that most of us forget about when running a business. It’s important to have measures in place so you know if a particular product or strategy is working. It gives you the option to change your strategy or break it down to make it easier to manage. By writing down the goals you want to achieve, you can look at them every month or quarter to see how you are doing against what you wanted to achieve at the beginning of the year…and adjust things accordingly – this might include removing certain goals, changing them or adding new ones. But if you don’t measure, you don’t know!
Your business plan is about what you want to do. It’s always a work in progress and once you have one and use it, you will wonder why you didn’t do it before!
Find out more about what to include in your business plan in more depth and how to do it …10 essential tips in making a good business plan
And click on this link for your free basic business plan template/instructions Business Plan
If you need any help or advice, please feel free to get in touch.
We all want our businesses to stand out from the crowd. Although it takes some time and effort, it’s worth it to have a unique identity that is instantly recognisable. Here are a few ideas that can help you along your way to having your own brand identity.
The first thing to do is to think about a mission statement for your business, which is a short sentence about what your purpose is. We all know Nike’s tagline, ‘Just Do It’ but did you know that their mission statement is ‘To bring inspiration and innovation to every athlete in the world’. So their mission statement encapsulates everything that the company is about and wants to achieve in one short sentence. This is no mean feat, but achievable for your business with a bit of thought. You could always get a few friends round and have a ‘get my mission statement’ party…but make sure you work on the statement before you start drinking…or you could have some very interesting stuff!
Brand Colours – The colours you choose are more important than you might think – according to research by web design and marketing company, WebPageFX, people make a subconscious judgement about a product in less than 90 seconds of viewing, and a majority of these people base that assessment on colour alone. In fact almost 85% of consumers cite colour as the primary reason they buy a particular product and 80% believe that colour increases brand recognition. Wow! That’s quite powerful.
Fonts – When looking at your brand for the first time, people will notice the colours and also the font – the way the brand name is written. There are so many different fonts, so try and choose one or two that enhance your business name…for example if you sell vintage jewellery, look at a vintage font.
achieve them. Having a 
What do you your customers like about your products? What do they currently buy from you, why do they buy from you and do they give you repeat business? If you’re not sure of the answers to these questions, it might be worth conducting a short survey to your customers and asking them. Give an incentive to reply, such as 10% off their first order of 2016. And a further 10% off if they recommend a new customer who buys from you. The more you know about your customers, your competitors and the business you’re in, the more likely you are to be successful
measure whether that particular goal and actions have been successful. By measuring as you go along, if you find something that is not quite working, you can tweak it so it works well. List what needs to be measured, for example, how many people read your Facebook posts or how many comment on a post. Then look at ways to improve this – it might be you monitor your posts and see what kind of post is the most successful and then figure out why. If you have success, shout about it! Your customers will feel reassured they are dealing with the right person
what you can and can’t afford to do and plan accordingly. At the very least, it’s a good idea to have business cards – maybe flyers and definitely think about Social Media and your online presence, such as a website.
experience for your customers; know what your customers want and give it to them; find solutions to your customers’ problems; position yourself as an expert; be different from your competitors and shout about how you are different; shout about your success; give excellent customer service; give special offers to customers who recommend someone new who buys something or uses your service….and above all, be yourself, smile and enjoy running your business – it will show!
I’m ashamed to say that by the end of January, I’ve forgotten all about the resolutions…I’m still aware that I want to do the things I resolved to do, but life gets in the way. However with business, you can’t afford to be so blasé – a planned business with structured goals will always be more successful, and reviewing your plans on a regular basis gives you the chance to pick up on anything that is going wrong at an earlier stage.
Measurable – to ensure that you attain your goals, they need to be measurable; then you can keep an eye on your progress and you will stay on track and reach your target dates. If you have a website for your business, one goal may be to push it further up search engines, so your business can be more easily found by potential customers. Questions you could ask yourself could be:
Timely – Goals always need to have a timeframe – if you don’t have a timeframe, then there’s no sense of urgency and it’s easy to keep saying ‘I’ll start that tomorrow’…and we all know that tomorrow never comes! If we go back to the weight loss scenario, if you say ‘I want to lose a stone’, but don’t put a time limit on it, it’ll never happen. But, if you give yourself a date (a realistic and attainable date), for example, ‘I want to lose a stone in three months’ – it’s more likely that you’ll succeed.
You could also consider performing a SWOT analysis on your competitors, as this will give you valuable insight into their strengths and weaknesses…and may identify opportunities for your business that they haven’t thought of.
A SWOT analysis can be completed by you, but it’s always good to have another opinion, so draft in some help. Ask friends, employees (if you have them) and maybe even some of your customers – ask them what they think are your strengths and weaknesses. You may be surprised at the answers and it may help you to pull together a strategy to help you succeed further or improve an area of your business.
choosing your products or services?
– Look at premises you currently work from (it might just be from home). What will you do if your business expands – what premises will you need to ensure your business succeeds?
– Are you likely to have cash flow problem – if so, how will you deal with it?
necessary.
The Write Way 