December holds special meaning to us here at SCORE, not only because it’s a time to celebrate the holidays with family and friends, but also because of its designation as National Write a Business Plan month. So much of our work with clients centers around planning and preparing for the jump into entrepreneurship or the next phase of a business and a thorough business plan is the ultimate tool for successfully accomplishing these goals.
I am constantly inspired by the real life examples of our many successful SCORE clients who have used business plans to their advantage. Clients from the start-up phase like Green Grocer Chicago whose owner, Cassie Green, says “My mentors helped me create a roadmap for my business and see that I was approaching it from the wrong direction” and whose subsequent success has allowed her to begin work on a second retail location. In-business clients like Aurico Reports call on their mentor, or in this case a team of four SCORE mentors, to evaluate their business’s current state, identify opportunities for growth and create a plan to achieve these goals. Their resulting success allowed Aurico Reports to add 12 new full-time positions last year. These clients continue to meet with their mentors regularly to evaluate the resulting growth and plan further into the future.
There’s been a lot of talk in the media lately about whether writing a business plan is still necessary or if it is an outdated practice. At SCORE we see the effectiveness of business plans every day, in every new business idea that gets fleshed out and every new storefront that opens on Main Streets across the country. And there’s statistical evidence that shows their value; our good friend and SCORE Blogger, Rieva Lesonsky reported on a study that showed that entrepreneurs who wrote a business plan were twice as likely to grow their business or obtain capital. And further analysis of that study found that writing a business plan correlated with increased success in every one of the business goals surveyed including: obtaining a loan, getting investment capital, making a major purchase, recruiting a new team member, thinking more strategically and growing the company. These results are not coincidence.
I’ll admit, there are some decisions in life where caution can be thrown to the wind, decisions which can be made on a whim with little planning or forethought. Picking a restaurant for dinner, trying a new sport or buying a new outfit – the thrill can be exhilarating. But all of these decisions have relatively little at stake. When starting or growing your business, your livelihood which you’ve likely invested a great deal of time and money, it is worth it to make the effort to create a plan that will guide your actions.
Some have argued that the new types of businesses that have emerged in this digital age may not require business plans. But I would argue that anyone looking to start or grow a business could benefit from writing a plan. At the heart of every business are the same components for success, factors like revenues, costs, and profits. Analyzing these moving parts before and during business ownership is critical to making sure the end result is worthwhile and successful.
And once that business plan is written it should be reviewed and revised on a continuous basis. As your business evolves you should use your plan to make sure you’re on track to reaching your goals. As your goals and various aspects of your business change so too should your business plan. It is a living, breathing document of where you are, where you’re going, and where you strive to be.
At SCORE we have a wealth of tested and proven tools and information to help you craft a plan that will work for your business. We have planning templates, online workshops, and blogposts that delve into the how-to of creating a plan for your business. You can find step by step instructions for every section of the plan as well.
Don’t get me wrong, getting started on the path to creating a business plan can certainly seem daunting. But tackling one section of your business plan at time will make the process easier and will guarantee you have a clear picture of every facet of your business. I always recommend finding someone who’s been there and done that to help. SCORE offers free small business mentoring to anyone looking to start or grow their business venture. You can connect with our mentors in a variety of ways from in-person meetings and email mentoring, to phone calls and Skype sessions. Click here to get started and find a mentor that can assist you in creating a roadmap for your business.
According to Benjamin Franklin, ““If you fail to plan, you are planning to fail!” And who can forget Yogi Berra’s famous words “if you don’t know where you are going, you will end up somewhere else”. Planning forces you to think through, in a logical manner, where you are going and how you will get there. It documents the details of your vision and goals. It allows you to anticipate your next steps and it prepares you for the inevitable uncertainty or road block. As Michael Gerber said in his famous book The E-Myth, take time to work on your business not just in your business. Planning and plan review is a great way to accomplish that and a way to know where you are going.