5 Steps to a Basic Business Plan

A common sitcom trope has the main character making something that gets the attention of a local businessman who wants to sell the product. They offer a price for a sizable but reasonable number of items. They go ahead and make the items that sell well enough for the businessman to ask for a considerably larger number. The character then gets comically overwhelmed trying to make a large number of the items only to find out that the cost is greater than what they are making. What went wrong is that they jumped into a business without planning. A business plan is an important part of any serious business.

Research the Business You Were Going Into

The first part of any business plan is to research the industry you are planning on going into. You need to get an understanding of the industry and how it works, as well as the customers. No business is worth the effort unless there is the revenue potential to make a reasonable profit. This is a key starting point that can make or break a business.

Develop a Business Strategy

Using the research that you have done, the next step is to develop a business strategy. First, if all of your competition is following a particular strategy, it is best to find a different approach. Finding a different approach will set you apart. This is also where you find any potential gaps in your ability to do the work involved so you can fill those gaps in a reasonable manner that will not destroy your profits. This business strategy needs to include how you are going to advertise your business, who are you going to approach as potential customers and how are you going to fill gaps in your ability to get the work done.

Determine The Costs and Potential Income

The biggest mistake made in our sitcom example is the failure to determine the cost before committing to doing the work. An important part of a business plan is determining the cost and potential income to see if there is enough profit to make it worth your while. It will do you no good to commit to doing work only to find out too late that you are losing money in the process.

Develop a Tentative Plan

Developing a tentative plan will help you to focus your attention on how you are going to proceed. This is where you lay down the essence of your business.

• What you are going to do.

• How you are going to do it.

• How you are going to get customers.

• Determine your costs and pricing

• Determine the long-term goals of the business.

Once you have the basics of your business plan it is important to write it down so that it is not just some vague idea in your head.

Proofread and Revise Your Plan as Needed

Proofreading your business plan involves more than just checking for spelling and grammar, but includes going over it to make sure you have everything right. This is a good idea for anything you might be writing. This is also where you might find it helpful to seek professional advice. Capture Management says to, “determine who your Program Manager (PM) will be. In most solicitation evaluations, the credentials of the PM are critical.” Be sure your program manager is able to effectively carry out your business plan. Also maintaining good record-keeping even at such an early stage is an important step in getting a business going so maintain a copy of each version of your business plan. That way you will know how you are progressing.

If you are serious about starting a business you need a good business plan. Trying to start a business without a plan is setting yourself up for failure. Furthermore, it will help you find the best way to get started even in areas where there may be lots of competition. Succeeding in business is not just about being able to do the work, but being able to get to work so that you can do it. A business plan is an important part of figuring out how you are going to get work for your business, and then getting it done in a timely and efficient fashion.