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Pinellas Park, Florida, United States
I founded Core Business Solutions with the goal of helping business owners improve operating results, add value, and recapture the energy and passion that was present when the business was new. We also have the expertise to assist start-up companies create the foundational structure needed to provide the best opportunity for the business to grow and prosper in uncertain economic times. Our goal is to help the business entrepreneur/owner, through mentoring and coaching, develop or enhance managerial skills while providing that independent and objective advice and expertise usually provided by a board of directors.
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Sunday, December 27, 2009

Business Plans...Why?

As part of my FNI Networking 30 second commercial in November & December I reminded everyone that it's time to review and update one's business plan. Recently someone asked, "if I'm just a small sole proprietor and do not need much money to keep my business running, why do I need a business plan?" It sounded to me as if they were thinking of a business plan as just a fund-raising tool. Actually, a business plan is much more than that: It is a tool for understanding how your business is put together. You can use it to monitor progress, hold yourself accountable and have some control of the business's fate. And of course, it's a sales and recruiting tool for courting key employees or future investors if that is ever needed. It should be a living document that is reviewed at least twice per year, but I recommend quarterly.

Writing a business plan forces you to look at all of your business, all at once:
  1. What's your value proposition?
  2. Marketing Assumptions & Budgets.
  3. Financial Plan & Budgets
  4. Operational Plan
  5. Staffing Plan
  6. Sales Plan

You will uncover poor assumptions that need some work. For example, if your marketing plan projects 10,000 customers by year two and your staffing plan provides for two salespeople, that forces you to ask: How can two salespeople generate 10,000 customers? The answer might lead you to conclude that forming partnerships, targeting distributors and concentrating on bulk sales to large companies would be your best tactics. This takes strategic planning & action.

Your Operational Plan will lay out major marketing and operational milestones. If you are the business founder, the only person holding you accountable to your desired results is you! Your plan contains the baseline for monitoring your progress towards your goal. If your goal was 10 new customers per month and after 6 months you have just 30, or 50% to goal, now you can analyze what activities (more networking, more social media marketing, more advertising, etc.)you need to increase, to drive sales to new customers. Your operational reports should tell you from what source your new clients are coming from. Now you know you could increase your marketing to that source, to increase your new customers.

But even more than a tool for after-the-fact learning, the business plan is how you drive the future. As many great business people have said, "The best way to predict your future is to create it."When you write, 'I expect 100 customers by the end of year one',it's not a passive prediction You can't just wait for the customers to show up. This becomes your sales goal.

The plan lays out targets in all major areas:

1- Sales

2- Hiring Positions

3- Expense Items

4- Finance Goals, and others

Once laid out, the targets become performance objectives. Now just break them down into quarterly and monthly objectives and monitor the activities you planned to reach those objectives.

And of course, a well-written plan {Note-it does not have to be a large 25-50 page document all bound up in a pretty format, a simplified version will work as well}is great for attracting talent to grow your business. When a prospect asks to understand your business, you can hand them a plan that gives them an entire overview. Their reactions will tell you something about how quickly and thoroughly they can think through your businesses key subjects. Plus, the written record of your goals, coupled with a track record of delivering against those goals sends this message loud and clear: You understand your business and can deliver the results you promise.

Great employees or strategic partners will respond to that message, as will banks and investors when you need to raise money.

So you can see why a business plan is not about raising money. You can use your business plan to:

  • Better Manage Yourself [Accountability]
  • Better Manage Your Operation
  • Measure Your Progress Against Your Objectives
  • Recruit Talented Employees You Need
  • Attract Investors or Strategic Partners

So to sum it up, before deciding to skip your planning phase going into 2010, consider all the implications and what they mean for your business success. To find success you must plan to. As my earliest mentor told me at least 20 times per month, back in the day, "Plan Your Work then (and only then), Work Your Plan.

In about 2-3 weeks or so I'll review another subject designed to provide business owners with information they can use to help them work "on" their business.
Until Then :

1- Live Simply.

2- Speak Kindly.

3- Care Deeply.

4-Love Generously.

All The Best,

Walt Morey
Executive Business Advisor Accredited by the Institute for Independent Business


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