Initiating Your Own Business Plan: Is It Necessary?

 Initiating Your Own Business Plan: Is It Necessary?

Creating a conventional business plan is essential if you are seeking initial capital for your startup or more finance to expand your current operations. Most would-be company owners perceive the process of writing a business plan as an intimidating and daunting task. Will you be the one to accomplish it? Does someone else get hired to do it? Without breaking the bank, how can you get it done fast? Will your own efforts be sufficient to secure funding?
Whether you choose to hire a business planning professional or do it yourself, this article will go over the benefits and drawbacks of each option.

The Home-Based Entrepreneur's Playbook
Get some education, read some books, or hire a coach if you need help writing a business plan; this is especially true if you aren't asking for more than $200,000 in funding.
Think about enrolling in a SCORE or Small company Development Center-sponsored three-hour company planning course. You will have a lot better understanding of the process and your goals, even if you opt not to make your own plan in the end.
An entrepreneur should do the business plan for a few good reasons: Being able to is the primary reason. You are not alone if the accounting lingo in sample company plans seems overwhelming. You can perform this job on your own if you are good at communicating your ideas and ask other people, like an accountant, to review the plan before it is submitted to lenders or anybody else. The ability to think analytically and run your company with a firm grasp of your own model is a skill you'll hone as you study the steps of business planning. An essential part of running a successful company is learning how to plan ahead. Thoroughly familiarizing yourself with the plan and fully grasping all of the variables involved is essential. "What will you do if only half your expected revenue comes in?" or "What will you do if you find out that direct mail is not working for you as your primary marketing tool?" are some of the harsh questions that potential lenders and investors may ask you.

Having a Business Plan Done by an Outside Party
Firefighters are entrepreneurs. Time management and focusing on one's strengths are two of an entrepreneur's most critical responsibilities. When entrepreneurs are in a rush for capital but don't have the time or resources to learn how to write a thorough business plan that investors and lenders will be interested in, they typically opt to hire a professional to do it for them.
Also, even if you want to handle part of the work yourself, it's a good idea to hire a professional if your budget needs are over half a million dollars.
Why you might want to think about getting a consultant: We will complete it! Working with an expert speeds up the business planning process. Though they mean well, entrepreneurs often find that months have passed and they still haven't finished all the tasks on their to-do lists. When dealing with urgent matters like customer calls and staff issues, planning often takes a back seat. Funding can be secured more quickly if the plan is finished sooner. And the cost of the consultant's services will pale in contrast to the gains in revenue and expansion that will result from working with them. It will be completed in a manner that is well regarded by financial experts. A person familiar with the way financial analysts evaluate plans and the questions they are likely to ask can do a better job of planning a company's future. You learn what to highlight and what to downplay when you've done the business plan process multiple times and know what it takes to secure funding. Expectations and projections for the company can be free of emotion thanks to the consultant's impartiality. The likelihood of issues arising once the financing arrives is reduced because a consultant will be considerably more impartial and will challenge your assumptions.

Never, ever allow a business planning consultant to convince you to include anything in your strategy that you aren't completely comfortable with. Your gut tells you it isn't correct if it doesn't appear right. The plan will remain in place after you've paid the consultant's fee; after all, it's your business. Verify that it is the strategy you envision, one that aligns with your aims and aspirations, and that it embodies your business philosophy and the essence of your organization.
For the most return on your investment (ROI) when working with a business planning consultant, be sure to ask the following questions: Tell me the total number of business plans you've created for companies like mine. Could you please tell me how many of these projects were funded? During the planning phase, how much of my time do you anticipate needing? When will the plan be finished, and how many revisions can I anticipate to see and provide feedback on? Is it going to be you who writes the strategy, or do you have associates who help you out? Before the final document is completed, would there be a chance for either of us to present the strategy to our other advisors? How can we ensure that my advisors and business partners have a voice in the plan's development through effective collaboration? Is it your job to compile financial spreadsheets and market research, or are such tasks handled independently and subject to separate fees? I was wondering if your pricing structure takes into account the fact that different forms of funding require different kinds of information (e.g., investors vs. lenders)? Is coaching to help me prepare to speak with lenders or give financing presentations included in your price? Will there be both a digital and a physical copy of the finished plan? This will allow me to make any necessary revisions at a later date.

A Hybrid Approach: The Best Choice
Ideally, the planning process would fall somewhere in the center, rather than on either extreme. Plan wins that result in funding, in my opinion, are the result of genuine teamwork between an entrepreneur's team of advisers and employees and a competent consultant or facilitator.
A business planning consultant might take on the role of a coach by analyzing the task at hand and then suggesting the most suitable candidate to complete it. All parties involved, including the entrepreneur's aspirations and the accountant's and other professionals' technical knowledge and experience, as well as the business planning consultant's research and writing skills, should work together to create the business plan. In order to complete the task as soon as feasible and at the lowest possible cost, the consultant should meet with everyone involved, go over the plan's requirements, and make full use of all available resources. The consultant's job is to put everything together in a way that any investor or lender can understand and use, so the final plan can pass muster. One last thing: Unless you have over a million dollars to invest, a few thousand dollars won't go a long way toward a plan. A number of people have told me terrible stories about how they paid tens of thousands of dollars to university professors who they thought were specialists but turned out to be incompetent. Get recommendations for a business planning consultant from your banker or, even better, speak to someone who has used this service successfully. The consultant is within their rights to ask for 50% payment in advance and the remaining 50% upon plan completion. Too much depends on your personal credit and managerial abilities; you can't blame the consultant if the plan doesn't get you funded. The finished plan will not contain all the steps necessary to run a successful firm. Developing a strategy for a company does not aim to do that. A standard business plan's sole purpose is to succinctly outline your company's strategies—just enough to get investors interested. You will need to invest much in consultation time and undertake a thorough strategic planning process if you are seeking a solution that will tell you how to market or how many employees you need to hire. You can't have a good business model without a good business plan. As you go through the business planning process, you will be able to see if your expenses are too high to turn a profit. Then, in order to turn the company around, you'll have to make some tough choices regarding how to reorganize your expenses. Expert though they may be, the business planning consultant isn't a magician. While a well-thought-out business plan can assist in minimizing problems and capitalizing on strengths, it will not be able to transform a flawed company model into a successful enterprise.

Finally, if you learn from your company planning that a certain venture would fail, you shouldn't move forward with it or try to improve your existing one. In the real world, things don't improve just because they work on paper. Get further training, think about redeveloping your products, or start a business from home to save money until you can afford an office. Then, deal with your deficiencies. Eventually, a company will go bankrupt due to a lack of capital. Take note of the fact that you won't be able to generate enough money to sustain the firm in the long term if your plan says so.
Wow, that's funny!

Location:

Share :