Business Plans

      Do's, don'ts, pros and cons on perhaps the most basic fundraising tools any business can possess. February 25, 2005

Question
I would like to get some information on business plans. Our company is well established in the laminate casework industry. The majority (80%) of our work comes from competitively bid projects. The balance of the work comes from retail customers and some other contract work with repeat/local customers. The company has been in business for 10+ years, however we do not have much of a business plan in place (at least that I know of). I am fortunate to be in a management position at a young age and I would like to make our company more professional.

I have researched business plans for a little over a month and found that I can purchase a program to help make a business plan, I can employ the services of someone else to come up with a business plan (which will require me to inform this person about our business), or I can try to make one myself. I would just prefer to do it myself with the help of some sample plans that I can use as a guide. Does anyone have a plan or outline they would care to share?

Forum Responses
(Business Forum)
From contributor C:
A business plan, in my opinion, will be far stronger if it is created by the person or team that will actually use the plan. There are different software programs, books and templates available, and I'd venture to guess they're all rather good. However, none will be a shortcut to actually doing the work, which is time consuming at best.

There are free templates in MS Word format free to download from the Microsoft web site. There are also some developed by SCORE (Service Corp of Retired Executives).



From contributor T:
I very much agree with the post above.

The standard business plan with all of the sections is real nice when you are doing a dog and pony show for a bank to get a loan, but it is pretty much useless.

It is great that you want to make a plan for the future. I would suggest that you make up your own plan... don't worry about having all the sections a business plan has. Sit down and make a list of all the areas that you can focus on - customers, existing customers, material procurement, work flow, employee retention, training, finances, company image, competition, and so on. Then sit down with your employees and find out 1. current status of section and 2. where you want to move to and 3. how you can get there. Do this for all the areas, and you have yourself a roadmap (business plan) that is in your company's language, which you hopefully can get your employees to buy into (since they came up with it, with direction from you).



From contributor J:
Why do you want a business plan? In my experience coaching many businesses (and running a few) over the years, they are an exercise in futility except when you are trying to raise money.

If that's the case, ask the bank or the investors what they want to see in the plan and do exactly what they want. Otherwise, it's real easy to waste a lot of effort on a wonderful document that may be precise but totally inaccurate.

If you want to help your company figure out where it's headed, I'd recommend a series of meetings with owners and top management facilitated by someone who's got experience doing this kind of thing. But if the folks at the very top are not committed to the process, this won't be much good, either.



From contributor M:
A business coach suggesting a business plan is a waste of time? I thought I heard it all. Now I know I have.


From contributor J:
"A business coach suggesting a business plan is a waste of time? I thought I heard it all. Now I know I have."

Well, 25 years of experience in business plus a bit of study has shown me that conventional wisdom isn't always as universal as it's cracked up to be. I don't believe most mission statements and vision exercises are useful, either. And I have a mixed approach to goal setting. Sometimes it's helpful and sometimes not.



From contributor F:
Before starting to write a business plan, I would recommend reading a book titled "The E-Myth Revisited" by Michael Gerber. It's an easy read and will only cost you about $10. It will give you some things to think about before taking out the pen.
Regarding a business plan, you don't have to write a book to create a useful roadmap for yourself. Two or three pages with the appropriate content is more than sufficient for internal purposes. Typical topics usually include:

1. A list of core values that are integral to you being able to work in your business (i.e. financial security, honesty, integrity, quality, etc.).

2. A paragraph that describes your vision of what you want the business to become. This vision should be consistent with your core values.

3. Your mission statement.

4. A strategic plan.

5. One or more tactical plans that give you tangible action items you can work on. Your tactical plans need to be consistent with your overall strategic plan.

6. A list of outstanding action items with due dates. Keep in mind that without due dates, this is useless.

7. An exit strategy.

Also, it is important to understand that a business plan is a living document that you use and update on a regular basis. Typically, your vision and mission will not change. However, your strategic plan should be reviewed regularly (i.e. quarterly). If business issues change, you might want to adjust your strategies.

Your tactical plan and list of outstanding action items should be used to create the agenda for weekly/monthly status meetings. This is what you use to hold everyone (including yourself) accountable for meeting their responsibilities. As tasks get completed, they roll off the list and new ones get put on.

Involving your employees and getting their buy-in is critical. Regarding the comments on mission and vision exercises, I agree. However, I think each of us has some idea of what we want our business to be and how we want it to run. It doesn't have to be a long, drawn out exercise to write it down.

There are lots of books out there that discuss this stuff in depth. You can also check with your local community college. Sometimes they have continuing education classes geared toward small business owners.



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