“Plan shman” you think, “I know what I’m doing and where I’m going” and at the start it will feel that way. But once you dive into the nitty gritty of business it’s easy to lose sight of the wood for the trees. You don’t have to be afraid of making a business plan, it doesn’t need to be a War and Peace size document. It’s a document that makes your life easier going forward, it is after all your business and so it’s your plan, Stan!
So what do you need to include
- Identify your customers – if you were to imagine your ideal customer who would they be and why? What is it about them that makes them right for you?
- What solution are you giving them? What is it about your product over everyone else’s that makes your ideal customer go straight out and buy your product?
- Where do you find these customers? Where could you or your advert go to catch their attention?
- What do you have right now that you can sell them?
- After they buy this product what else will they need?
- What / if anything do you have in the pipeline for the coming year that you could sell them?
Now you need to dig your calculator out here and be brutally honest. The old adage of Turnover is Vanity and Profit is Sanity is going to put in an appearance
- How much is your product x how many purchases = how much money you will make every week / month. This is your turnover. Now I said be brutally honest, and it’s not that I don’t trust you but take 20% of this figure and you have a realistic number!
- What will you spend every week/month doing this business? (Again be brutally honest, if you really, really, really need a fancy new laptop with all the bells and whistles then factor this in, if you just want to be that cool guy in the coffee shop with his fancy laptop talking about his start up. . . don’t be that guy. And add another 10% on to these costs because you thought about being that guy!)
This is the really important bit!
If you minus the bottom figure from the top are you still in the black? Do you have enough money coming in to cover what you have going out?
If the answer is yes, well then High Five!
If not then you have a problem. You need to go back to the start of the plan and work out what needs to change to get the numbers right. Sacrificing small animals in your garden to the God of Give Me More Customers is not an option . . .
This business plan is not the be all and end all. There is much more to running a business than what we have just covered. But if you are earning more than you’re spending you’re on the right track! What bit do you find hardest when doing your business plan?