8 Steps to
Creating a Simple Business Plan for 2003
By Herman Drost
Contributing Writer
Article Date: 02.04.03
Your business plan is like a road map to long-term success. You may have
been in a situation where you didn't have a map to find your destination and ended
up horribly lost wasting precious time and money. Well, the same can happen if
you don't plan out your business strategies.
Why you need a business plan.
It gives you a clear direction where your business is heading.
Many business owners just jump into creating a business
without researching and making a concrete plan.
Inevitably, they soon find that they are out of money and
have no time or clear strategies how to market their business.
Here are 8 simple steps to creating your own business plan
(this is by no means a comprehensive plan but a primer to get you
started):
1. Name of your business - create a name or reevaluate the
name of your business. Does it integrate well with what you are selling? Is it
easy to spell and remember? Is it a name that can be well branded over time?
2. Vision - what will your business look like 5 years from
now? Think of how you may want to expand it to include other branches or extra
employees.
3. Mission statement - this defines what your business really
does, what activities it performs and what is unique about it that stands out
from your competitors.
4. Goals and objectives - clearly define what you want to
achieve with your business. Make sure they are quantifiable and set to specific
time lines. Set specific goals for each of your products or services.
5. Strengths, weaknesses, opportunities, threats (SWOT) -
by analyzing these characteristics in your business, you will get a clearer idea
of what it will take for you to not only to survive but also prosper.
This could include such factors as:
- your companies own changing industry
- the marketplace which may change due to social and
economic conditions.
- competition which may create new threats and/or opportunities.
- new technologies which may cause you to change products
or the process in how you do things.
Evaluating your SWOT will help you to:
- build on your strengths
- resolve your weaknesses
- exploit opportunities
- avoid threats
Doing this analysis will help you create a more realistic
strategic action plan.
6. Strategic action plan - this is the most critical step
of your business plan, because without it, your business will not get off the
ground. This should include your sales and marketing strategies.
(read "How to create your web site marketing plan"
http://www.isitebuild.com/websitemarketingplan)
7. Financial plan - a business can operate without budgets,
but it is clearly good business practice to include it. With budgets, you will
be more likely to achieve your business objectives, you will make more-reasoned
decisions and you will have better control of your cash flow.
For any period, a cash flow statement would include: - The
cash and credit sales (or accounts receivable) expected to be received during
the period.
- The anticipated cash payments (for example, expenses for purchases,
salaries, utility charges, taxes, office expenses etc.)
- A description of other incoming and outgoing cash, with a calculation
of the overall cash balance.
This will assess how much money is on hand to meet your
financial obligations - what cash has been received and what has
been paid out. Knowledge of this cash flow cycle will help you
predict when you will receive funds and when you will be
required to make a payment.
8. Measuring and evaluation - you wrote your business plan
and set the goals with the intent of achieving them. So now break them down into
measurable pieces and monitor the results regularly. A plan that cannot be measured
is almost always destined for failure. Celebrate your wins and recharge yourself
to accomplish your next goal.
Decide beforehand what constitutes a real serious loss and what
loss will be acceptable.
If you find your goals are unrealistic and unattainable, adjust
them, but realize that it takes hard work to achieve them, so
don't give up easily.
Conclusion:
Now that you have a business plan, make it a part of
you by knowing and understanding it clearly. Build upon it
continuously and refer to it often, so you remain on track to
building a profitable business.
Resources
Small business association -
http://www.sba.gov/starting/indexbusplans.html
www.soyouwanna.com/site/syws/bizplan/bizplan.html
Download a free business plan template:
http://www.business-planware.com/freepln7.zip
Sample business plans
http://www.mplans.com/spm
Online business planner
http://www.planware.org/strategicplanner.htm
About the Author:
Herman Drost is the author of the new ebook "101 Highly Effective Strategies to
Promote Your Web Site" a powerful guide for attracting 1000s of visitors to your
web site. http://www.isitebuild.com/web-site-promotion
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