MAKE FIRST PLAN THOROUGH, CANDID
By: Constance Lee Menefee
Do your first business plan for yourself. It is a tool for spelling out how you think your company will work, what you are going to sell, who your customers will be, how you plan to reach them and what all this will cost.
Don't worry about how you will finance your business first time through the plan. This one is for you. Be candid and thorough. Show it to people you trust and ask them to be honest. Get information from as many sources as you can find.
Keep in mind that the plan is to clarify your thinking, identify your challenges, spell out your strengths and weaknesses.
A plan is a tool for setting goals and examining how you will reach your market, not a static document to be done once and shelved. It should be re-visited with lessons learned and realistic numbers and projections added.
The plan's format may be important if you are going to use it to gain financial backing. When the day comes to show your plan to potential investors, do some research before committing it to final layout and design. Different lenders may prefer - or even require - a particular arrangement.
If you simply use the plan as an internal strategic document, arrange it in a way that makes sense to you. Keep in mind, however, that the plan is also useful tool for making proposals to potential clients, so make it sure it is error free and looks professional.
Your plan should answer the following questions:
- What is my product or service?
- How is it different from others available?
- What are the significant trends for my kind of business?
- Who are my competitors - locally and nationally?
- Could any of them also be potential allies or clients?
- Who and where are my customers?
- How will I get my service or product to market?
- What will it cost to reach the customer and deliver my goods?
- What kind of advertising and marketing is most effective in my industry?
- What prices or fees must I charge in order to make a profit?
Article originally appeared in the Cincinnati Post, May 19, 1998