Business Planning Process

February 4, 2013 | By More


 

The Business Planning Process does not necessarily mean you need a professional written business plan right of the bat, after all that can cost you anywhere from $1500 – $6000 USD, depending on how large your enterprise is going to be. You might even try to write the plan yourself, which is fine. However, keep this in mind: as long as you are not looking for funding from a bank, angel investor or fund, you are better off taking a yellow pad and writing your basic outline. Let your thoughts spread, write any of the ideas as they come. If you have a partner, brain storm together, put your ideas down on the pad.

This is the most important rule if you start to plan out how your business will have to look like, how you envision it. Put it in writing and then organize it.

First, I would like to give you a very simplified approach to the business planning process without maintaining the required format. This is particularly for those who do not seek any kind of outside funding, it is therefore more praxis oriented. Follow this guide.

 

Business Planning Process

 

  1. What do you really need to get started?

  1. Do you need money? How much? Where can you get it from?
  2. Do you need an office space? How big?
  3. Do you need employees? Sales, admin personal?
  4. Equipment needed
  5. Accounting
  6. Management

 

  1. Create your administrative structure

    Once you have answered the above questions, create the backbone of your company and what a good working administration is. What this means is you get organized and plan the setup of your company properly, creating a system which can be easily duplicated. This will enable you to fall back on your structure when you start selling, answering to customer service calls, marketing, prospecting and networking. If you are a one man show, having a system is even more important, because you literally work five jobs at once and a strong organizational structure is vital to not become overwhelmed fast.

 

  1. You need to create your brand

    You are in business for yourself now, but people don’t know that three things are vital

  1. You need a company identity, logo, letter head and business cards
  2. You need to create a simple website (instantly reach global recognition)
  3. Set up your email, signature and social media pages. Add your logo and contact information to each.

 

  1. Create a plan for marketing
     

    1. Identify your market, who are your your potential clients
    2. Create leads through email marketing, SEO for your website, local ads, etc
    3. Network social clubs, sport clubs, church, business network international

 

  1. Priorities

    You need to learn how to set your priorities correctly. It often happens that we get lost in a specific task which is necessary but not productive, remember the number one most important thing is to convert your efforts into a monetary equivalent. Simple rule to remember, closing deals first then back to lead generation and prospecting. A new client potentially means income for you and is considered a productive task. Creating a website is a necessary task, but not immediately productive; meeting with a potential client is a productive task, answering an email is not. Understand that you need to concentrate on production first, leave the details to others or run the administrative tasks after regular business hours.
     

The business planning process for an enterprise established on fundings is to be created in a specific format. One of the paradox is that the bigger the idea you have, the more money you will be asking for, the easier it might be to receive funding. Potential investors like to make big returns and the way to achieve this massively, is by investing in big ideas. Needless to say, the idea needs to make sense and the financial needs have to be worked out correctly. It is therefore advisable to meet with your accountant and have the numbers worked out in detail. Either hire a professional to write your business plan or utilize a business planning software.


Below are the 5 components of a basic business plan
 

  1. Summary (also called Executive Summary)

    The summary is a brief overview of the entire business plan. It Includes an introduction of your business, market and competition, your name, the name of your partners, the company name, and your vision of where you see the company developing in the next 5 years. If you are seeking funding include the amount of money you are looking for, how you plan to repay it and what your exit strategy might be. Even though the summary comes first in the business planning process, it is recommended to write it last. Typically keep the summary short and crisp, not more than two pages in total.

     

  2. Description of your Business (Business Description)

    This is the detailed introduction of your company, it's legal name and structure, full address, names of all officers including all contact information and full addresses. If you seek funding, include the names and contact data of your attorney and accountant. It also needs to mention the business status (start-up, franchise, expansion)

     

  3. Employees, Business Location & Operations

    Include the location where the business will operate, describe the amount of employees you require for administration, sales and management; as well as the amount of money needed for salaries. Detail explanation of your products and services, office space required, furniture and equipment. Banks like to see experience of owner and management as an indicator for the success of the business.

 

  1. Marketing Plan

    Included in the business planning process is the marketing plan, which we will discuss in more detail, in another chapter, under marketing planning process.

Marketing is the most important part of your business and can make or break an enterprise. Consider who you will sell your product or services to. Research where your market is and be aware of your competition. Create pricing structures; be aware of acquisition cost, lead generation, conversion rates, margins and profits.

 

  1. Financials

As mentioned before this point is particularly important if you seek financing. Include a detailed financial statement of your company and future prognosis. If you have partners also include your personal financial statements, those of your partners and officers. Make sure to consult your accountant or bookkeeper for detailed information.
 

There are numerous ways to set up your plan, start out by gathering all pertinent information, write down the basic outline and fill it out as needed. If you seek assistance with your business planning process, please do not hesitate to consult us. We will happy to assist you!

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Category: Management related, Starting and building a business

carsten@officentos.com'

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  1. carsten@officento.com' Christian Horwitz says:

    Nice Article, got some good ideas and guidelines how to start my business.

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