You have owned and operated a small business for 5 years. Quite possibly, you are thinking about starting a business. Do you have a plan for your business? You might think this is a silly question, but please consider the following facts. A study was commissioned at Harvard University some years ago involving the graduating class. A graduating class was selected and 20 years after their graduation, they were asked if they had written down their goals. Only 3% of the graduates had written down their goals; however, the net worth of that 3% was greater than the combined net worth of the remaining 97% who had not written down their goals.
I think there are many important lessons to be learned from this true story. The one lesson I want to focus on for business owners is the critical importance of developing a written plan for your business. For those business owners who have a business plan – congratulations! I will speak to your situation shortly.
For those business owners and want-to-be business owners, developing a business plan is one of the most critical steps you must complete if your business is going to survive and thrive over the long haul. If I could provide some insight into how you can develop a business plan, I offer the following:
1) Write the business plan yourself. Please don’t let someone else, who is not a partner in the business, write your business plan. You and your partners are the ones who have the idea, the vision, and the ability to translate that vision.
2) Don’t be afraid of the reading, writing and researching required to develop your plan. I have found that as I research, I actually learned more about my industry, my competitors and myself in the process.
3) The resources available to develop your business plan are innumerable. Resources can be found at your local public library, online through your local public library, magazines, on the internet, the Small Business Administration, your local chamber of commerce, your local SCORE (Service Corps of Retired Executives), Small Business Development Centers, and University Extension offices, just to name a few.
4) If your plan is to secure external financing (funds outside of your own capital/equity), you should begin developing personal relationships with potential funding partners whether they are credit unions, community banks, larger banks, high-net worth individuals or others. Be honest with them, tell them exactly what you are doing and that you might look to them for financing.
5) Do you have an Advisory Board? Do you have a group of people you trust that can provide advice, counsel and feedback (honest) on your business plan such that you can revise your plan to make it higher quality.
6) In your discussions with commercial bankers, have you asked them if they might allow you to review the business plans of potential businesses that they rejected? These plans and discussions with your potential lender can be very valuable in understanding what a loan committee is looking for.
For those business owners that have a business plan, when is the last time you looked at it to assist you in making a decision in your business? If you spent the time to develop your plan, you must spend time using it on a regular basis to make decisions in your business. A business plan is a living document that will change over time but it is the foundation upon which your business was built. I urge you to spend time in your business plan and make the necessary changes using the steps I mentioned. I wish you all the continued business success you can handle.
Submitted by Chris Chiodini, Community Development Director, City of Grandview............................................We encourage your comments. Be sure to read the Bloggers' Guidelines posted in the footer of this blog. Especially see item 6 regarding anonymous accounts & postings. Thanks for joining the discussion!
No comments:
Post a Comment