Scrap the Big Business Plan – Here’s a Better Idea

Out of 300 people polled, 72% said they did NOT have a written business plan.

The truth is that most of you reading this article do not have a written plan.

Why?

Let’s see. You know you need a business plan. You’ve heard it from many sources, “Write your business plan!” So, you sit down and begin. Hmmm… bios, sales and growth projections, competition, graphs, marketing. It all seems so overwhelming. You realize this is going to take longer than you thought. You put it down to continue another night. That night doesn’t come.

Sound familiar?

How about this scenario: you actually finish your business plan. One year later, you realize you have not accomplished your goals, your finances are not where they were projected. You feel like you are failing.

Can anyone relate?

Relax, it’s okay. The big business plan gig is really not for us small, home-based owners. So, scrap the big business plan.

Here’s a better idea.

It’s not that big business plans don’t work for us, rather, they can’t work.

The traditional business plan is really only for one reason — to sell your business idea to investors. If you’re looking for venture capital, you have to put together a big business plan, and a very good one at that. While a very small sampling of you may wish to go this direction, the reality is that most home-based business owners are simply wanting to make a decent living at home.

In a poll of 300 online home-based business owners, 64% said they work part-time on their online business and receive part-time income from it. A pretty big chunk of online home-based businesses. These are people who are simply looking for a little extra cash, or they look at their business as a hobby.

In contrast, a paltry 16% of home business owners works full-time at home and receives full-time income. I would venture to say that an extremely small percentage of this group is actually looking for serious venture capital to take their business to another level.

Don’t get me wrong, we could all use a little extra funding, but that’s not what we’re talking about here. A few thousand dollars to start up your business doesn’t usually come from investors.

Keeping this in mind, if we put together a traditional business plan (to impress investors), generally, what we put into the plan, will be the wrong things for the wrong reasons. If impressing the investors is not your intent, you can’t succeed in this kind of plan. It’s that simple.

So, do you actually need a business plan?

Oh, yes! You simply don’t need the traditional business plan. Rather, what you need is a plan that will help you (and only you) take control of our own business. Think of it as a guide that will give you direction and keep you on track.

Ask yourself these questions:

1) Why am I doing this business? What are my motives?

2) What do I personally want to do with this business? What do I want to gain?

3) What are my personal strengths to offer to the business? What are my weaknesses?

4) What new knowledge will I need?

5) What parts of my business can I outsource?

6) Where do I want to be in six months from now? One year? Five years?

See the difference? These questions are you-based. Write down your answers as a preface to your plan. Refer to these questions often and adjust your answers as your perspectives change over time and as your knowledge grows.

Now, with the above in mind, go ahead and pencil in your thoughts on the following. Your answers won’t have to be terribly involved. This gives you a roadmap, nothing more. And, it will change and evolve over time. Remember, you’re not answering to anyone but yourself. You’re not trying to impress anyone.

  • Business Mission Define it as YOU see it.
  • Evaluate the Past Take stock in what your business has done in the past year. Summarize your business’ strengths and weaknesses. Ask yourself, “Is my business profitable or does it indicate that it will be?” “Have I attracted new customers?” “Have I maintained customers?” “Am I happy with where my business is going?”
  • Your Personal Competitive Edge This is not about your great domain, nor what great products you have, rather, this is what YOU, personally offer… your own innovation, what powers your business. YOU are your small business’ brand, its greatest asset. You must think in these terms.
  • Your Business Competitive Edge This is where you list your products/services. Separately list those you have and those you plan to add. Include any patents, logos, designs, licenses, domains, any kind of intellectual property.
  • Customer Relationships As a small, home-based business owner, your marketing is very different from big or even mid-sized companies. Your marketing heavily relies on relationships. Write down the ways you make or plan on making relationships with your customers. Think innovatively in terms making relationships. Don’t simply jot down a laundry list of ways you will advertise.
  • Business Relationships List your partners (your spouse?), strategic partnerships you have made or plan to make, mentors, industry experts. Who generally and specifically will help you grow and develop your business? List external and management relationships such as your banker, your CPA, your attorney. List your suppliers. Think about how involved you want your family and friends to be involved in your business.
  • Finances This should identify a clear plan for quantifying results. Develop landmarks and goals. Yes, forecast, budget and project. This is something you need to do to keep your focus. Review this from time to time and set yourself back on course if you begin to stray, or re-evaluate to make more realistic changes.

Phew! Now, take a deep breath and you will find that this exercise will actually do more to help you focus and grow your business the way YOU choose than any other traditional business plan ever could.

Why not sit down and give it a try. And, if you have any ideas to add to the above, by all means, give me some feedback.