The better you understand your business, the better prepared you are to write the business plan. Ideally, you will have thoroughly thought out your business long before you ever open your doors for sales. Too many entrepreneurs jump into business with both feet and don't bother with understanding (let alone planning) until the water is rising. Jumping into the deep end of the pool is not the best way to learn to swim. If you are lucky, you won't drown, but even if you make it out of the pool, the experience is likely to be remarkably unpleasant.
THE BUSINESS SECTION
The major part of your business plan should be a detailed description of your business. You'll address your corporate entity choice, be it corporation or limited liability company. You won't even consider using a sole proprietorship or general partnership, because, first of all, investors wouldn't even bother to read the plan and, second, there is too much personal liability for you in a sole proprietorship or general partnership.
Your detailed description will also include strengths and weaknesses, a description of your operations, locatio, personnel, records, insurance and security.
For business, the market, and the financial sections of your plan, it is best to introduce the section with a brief (as in one page) summary. From there you can use more details in subsection. While the entire plan should be be succinct, these summaries will allow interested parties to graze for pertinent information.
There are two questions you need to ask yourself about your business that color every part of this section, though their answers are never directly addressed in the plan:
- Why are you in Business?
- What is your business?
If these seem like easy questions to you, either you've done a good job thinking through your business or you haven't even started. We'll hope for the former.
WHY ARE YOU IN BUSINESS?
How well do you know yourself - in particular your business motivations? When you decided to go into business was it out of desperation (lost job, family illness, personal injury)? It's okay for desperation to spur you into a new direction, but don't let it rush you. Did you decide to go into business out of a desire for personal fulfilment (following a dream, helping others)? Many businesses are begun just for this reason, but if you don't understand the realities of owning and operating a Business, you are not likely to stay in business long enough to do you or anyone else any good. Did you decide to start a business in Hope of amassing great riches? This is another common reason, but chasing after money runs the risk of leading to early burnout and/or disillusionment. Understand your motivations, and you can guard against any typical disaster.
WHAT IS YOUR BUSINESS?
Don't answer too quickly. Just because you sell office supplies, that does not necessarily mean you want to look and feel like all the competitors. Think about it: there are plenty of office supply stores out there. Most are better established than yours. Many will have lower prices than yours. So why should any one go to your store? Answer that question and you will know what business you are really in. Do you offer faster service and delivery? Do you have a specialized staff that can help clients with organization, technology or planning? What is it that your customers (or potential customers) say about your business when they recommend it to friends? What part of the idea for your business originally got you so excited that you couldn't wait to tell your family about it? When it comes to identifying the heart of your business, look to your own heart. Concentrate on what your business bis rather than what it does. Think back to the spiritual mission and business mission section and ponder what higher purpose you have to serve that will differentiate you in your space and allow you to generate cash flow.
With the answers nto this two deceptively simple questions, you will hopefully find the key that unlocks the potential of your business idea-an identity that can't be duplicated. And it is that identity that will Garner you fundings, investors and customers. But first we've got to overcome one of the toughest parts of Business plan authorship: writing about your strengths and weaknesses.
In my next subsequent posts I will talk about the *strengths* and *weaknesses* section of a good business plan.