Small Business Plan to Fail or Fail to Plan
During College, I was blessed with the opportunity to help write business plans for small businesses looking to secure loans. It was without question my most challenging college experience. It was not a challenge because of the work but because, I had to juggle a full course load with working on this small business initiative. It was during this time I got and appreciation for what it took to run a small business.
I took that learning to heart and went into banking to understand how to get a loan. I wanted to focus less on the plan and more on the action. I thought that if I understood how bankers think that regardless of the situation, I could get a loan. I was right; you can have a great deal basically "finance itself". A touch sell is a deal that makes no sense at all. That is why banks will lend on the purchase of a home, but not on the purchase of a mutual fund.
Even while I had the business plan writing experience, I failed to write my own business plan. I'd set up many small business, but figured I'd plan to fly by the seat of my pants. Doing that works sometimes, but failing to plan is really planning to fail. When you drive a car, you must know where you are going in order to get there. You must abide by the traffic laws and know the roads. You must be aware of the check points and be sure not to break the law. You must have enough gas to get going. You must maintain all fluids in the engine to ensure the vehicle doesn't break down. A big key is you must know how you are getting back if you plan to get back to your point of origin. All the same items are needed when starting your business too. Without those key elements, you are planning to fail:
6) Know where you are going: With each business plan you must map out exactly what your business concept is. Your business concept is really a boiled down point of your mission and vision. You mission and vision is what you are doing in business and why are doing it. This is a crucial point of your business because it where you strive to get to as a company. Without a mission and vision, your small business is simply wandering aimlessly like a teenager cruising burning gas on a Saturday night. You might come across success, but you are just as likely to be bored find nothing and end up right back at home.
5) Abide by the traffic laws: Business law for a small business is the difference between success and failure. You must either brush up on your industry business law personally or higher a lawyer to protect your company. One of my favorite lines from Scarface is never underestimate the other mans greed. When you have something desirable, people want it. That goes for business, women, money and anything that is worth having. Anything worth having is worth fighting to keep. The business laws are the ways you fight to keep what is rightfully yours. It helps you protect you corporate assets, and operate business ethically. The more you run the Red lights in business, the more you are likely to get caught. Even small parking tickets can be an issue if you do not address them. I had a friend that has a company that he'd operated as a sole proprietor. He ran this business until someday someone mentioned to him that he should open and LLC to protect his assets. He always wanted to but thought the business law was too complicated. He was finally convinced and did it just in the nick of time. Someone came after his company for an issue and initially attempted to go after him personally. As and LLC he protected his small business and is still in business today. He failed to plan in his business plan initially but his quick adaptability worked to his business' advantage.
4) Be Aware of the Check Points and don't break the law: There are so many business law requirements for a small business that you need a lawyer and accountant. Truly, the lawyer focuses on your legal form of ownership and business assess protection. The accountant makes certain that you stop at every major stop light and give government their dues. Some small business operating as LLC or corporations, must file quarterly while others once a year. It is best to utilize and accountant to ensure that your taxes are properly done. Beyond that, the business will allow you to be taxed at a better tax rate than individually. It is somewhat like the HOV lanes on the highway. Hybrid cars can go in the HOV lanes even with one passenger. Your accountant can help you navigate through business plan planning when it's best to be a hybrid kind of small business. You should be certain to include your accountant in consideration of your business plan.
3) Have the Gas to get going: All cars need gas or some kind of fuel. All businesses need money or some kind of income. Without the gas a great car can not move. Without money, a great business idea will just sit on there and become nothing. You can work around not having gas or money. However, it's a challenge to say the least. I've been there done that and bought the t-shirt. It is always better to plan within your business plan to have money. The more you find sources and uses for funds in your business the better prepared you are to succeed.
2) Maintain all fluids in the engine to ensure the vehicle doesn't break down: This part is crucial. To say the least gas is important with a car. Yet you must keep the oil changed regularly. You must change your transmission fluid. You must make certain that your coolant levels are good. Windshield wiper fluid is important. There are so many items associated with your car that you must check and retest that you are certainly going to need a mechanic at some point. You will need a specialist to keep you up and running. Some businesses are simply run by one person. There is nothing wrong with that. If you are a mechanic then it makes sense for you to work on your own car. Yet, the power of business is other people. In small business, the more you can leverage your idea through other people the better business you will have. Perhaps even your small business with become a big business. The fluids and cogs of the engine are all a form of leverage. You must make sure the people in your small business are happy to reach the ultimate goal addressed in the business plans mission and vision. Without checking your fluids, you will be on the side of the road broken down and wondering why.
1) Know how you are getting back: You might want to keep going and just travel without ever coming home. However, it is usually a situation where you want a need to know how to get back. Whenever you go out as a small business, you always want to come home. Some businesses consider home base to be a monthly review of the business plan just to make sure that they are on course. Some consider reaching a goal and then being able to give back to their community home base. It really varies for each business. Yet and still everyone has a home base. Home base to me in my business plan is a point of reflection. A point where I look back over what has transpired and I give thanks to God for all his blessing. I strive to give back and show my son what it is to give back to others. And as a whole I strive to keep it moving so that he will have a legacy in the future. When I think of all those things I'm home. And once home, I'm ready to venture out again and make it happen.
I wish you good luck with whatever business you get into and don't forget to maintain that business plan.
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