We always say to new entrepreneurs that the first step to starting a business is writing a business plan. Well what exactly does that mean? Many would be entrepreneurs view the business plan as some elaborate scary monster with intricate sentences and paragraphs that go on and on like the tentacles of the St. Augustine Monster. When you break it down and look at the business plan for what it really is, it is nothing more than a written expression of ideas that probably already exist in your head or at your fingertips (thanks to the internet). After all didn’t the St. Augustine Monster, through recent technological analysis, turn out to be whale blubber instead of some horrifying giant octopus?
Like the whale blubber, the business plan is not scary and certainly not mysterious. The best way to think about the plan is to consider personal major occurrences in your life and think about how you would address them. For example, let’s consider planning a wedding, buying a house or a family vacation. Each of these involves some sort of plan of action that will lead you to your eventual goal.
With a wedding you would have a checklist of action items that would need to be completed before the big day. With a business plan, so should you identify major things that need to happen before you can open your doors. Some examples of this would include identifying who is needed to help you, what is needed, when it needs to get done and how to do it.
When buying a house, you would have created a budget prior to picking out what you want. Most people get pre-approved so that they have a clear understanding of what they can afford. With a business plan you review the costs associated with the aforementioned who, what when and how to determine if you can afford to start and run the business. You look at your budget and you determine the feasibility of starting the business based on the costs associated with answering these questions.
A family vacation is usually a big event and involves multiple generations. For those of you with families like mine, you know that without proper planning the event would be a train wreck waiting to happen. There are so many personalities that exist within families and extended families that they best way to ensure a happy and safe vacation is to take the time to create a itinerary/plan to map out exactly who is responsible for what and when you are going where and how you would be traveling. Your business plan is no different. You often have to involve several people to help you get it done, an accountant, a lawyer, a graphic designer; you may even have a partner. In order for these relationships to be successful, clearly state job responsibilities and create timelines that can be adhered to and checked to encourage action and to ensure that you stay on task.
Following are some of the components that should be included in a business plan. Remember, do not let the idea of writing your plan cause you to get bogged down in thought or rendered inactive. Just think of it as if you were planning some personal event and do what would come naturally. Remember St. Augustine’s Monster was only scary until it was discovered that it wasn’t a monster, just a big pile of whale blubber.
- Executive Summary: Write this last. It’s just a page of highlights.
- Company Description: Legal establishment, history, start-up plans, etc.
- Product/Service: Describe what you’re selling. Focus on customer benefits.
- Market Analysis: Know your market, customer needs, where they are, how to reach them, etc.
- Strategy and Implementation: Be specific. Include management responsibilities with dates and budget.
- Management Team: Include backgrounds of key members of the team, personnel strategy, and details.
- Financial Plan: Include profit and loss, cash flow, balance sheet, break-even analysis, assumptions, business ratios, etc.
Thanks to the internet most business plans can be demystified just by reviewing samples of plans that others have written. They may not be exactly what you want to do Tuesday, April 26, 2011but don’t reinvent the wheel use the resources that are available to you. Check out www.bplans.com.
Jamillah Lodge is a Business Development Officer for Bermuda Small Business Development Corporation. She specializes in providing aspiring and existing entrepreneurs with business development advice and loan guarantee assistance. In addition, she manages the marketing and communications plan for the Corporation and oversees the development of a mentorship and youth entrepreneurship programme. She has a degree in Business Administration with a concentration in Marketing. The opinions expressed in this article are those of the writer and should serve a general guide and should not be considered as replacement advice from a lawyer, accountant or other professional service provider. Readers should consult with the appropriate professionals as necessary.
If you have questions about starting a business in Bermuda, just ask the BEDC team: Email us at firstname.lastname@example.org or call 292-5570.