people you do not know, better keep yourday job.3.
You will be the oneeveryone turns to for the answers. Are youready to call the shots?4.
Being able to hang in therewhen business gets tough is an importantquality in small business owners.Compare your skills and expertise withothers who are successful in similar businesses.Can you duplicate and surpass the capability of other successful businesses? What unique skills,
or “edge,” can you provide to obtain a sufficient
share of total market?Review business journals, trademagazines and other comparative studies thatidentify the requirements to operate thebusiness. From that information, derive aformula for the skills and traits you plan toincorporate into the business operation.
Why is a business planimportant and who shouldwrite it?
A business plan is important because itsummarizes both your vision for the company
and your blueprint for the company’s operating
success. The business plan is a written guide thatdetails the start-up and the future direction of your company.Who should write the plan? You,the entrepreneur. No one else knows yourbusiness idea and goals better. Yes, there areservices that can do the work for you. However,you must present this business idea to bankersor other investors. Therefore, it is best if you arevery familiar and comfortable with the
plan.Although there’s no set format, a good
business plan typically includes:1.
Identifies your business2.
Table of contents
Organizes informationfor the reader3.
—Provides a “bigpicture” view of the plan, highlighting the
factors that will lead to success4.
If it is a brand-newbusiness, include your background and skills5.
—Relates the business’s
Summarizes how you willcreate and deliver your product or service7.
Financial statements and projections
Illustrates how the business will perform
financially based on the plan’s assumptions
Includes statistical analyses,marketing materials, résumés.
If I am not planning to applyfor a bank loan, why do I needa business plan?
The fact that a bank or lendinginstitution requires a well-executed businessplan is a secondary consideration. The primarypurpose of the business plan is to guide theowner or manager in successfully operating thebusiness. Preparing the plan forces the writer toconsider all aspects of the business and toconfront any problems the plan highlights.Forexample, a monthly compilation of all knowncosts, over time, will indicate the revenuenecessary to support these costs, plus a profit.This leads to the question of whether or not thisrevenue number is reasonable. If not, it may castdoubt on the viability of the venture itself.Thebusiness plan is a vital management tool thatenables the manager to anticipate situationsbefore they become problems-or worse yetemergencies.
How do I determine my start-up costs and other expenses?
It is wise to find out what start-up costsyou will incur before starting the business. Manya budding entrepreneur takes his or her lifesavings, or will borrow on the equity on theirhome before figuring these financial factors,
only to find that they don’t have enough money.
There are many web sites and other resources(including SCORE offices and BusinessInformation Centers) that provide guidelines andworksheets to help determine costs for yourbusiness.Each item on your proposed budgetsheet should be researched. Closely estimatedcosts can be obtained from utility companies,trade associations, shopping and networkingwith other business people who may havealready gone through this experience. Do not