Road map to business success

road map to business success

Your road map to business success.

Now, more then ever, a well thought out Business Plan is seen as a necessary tool for building a viable business. Whether you are seeking financing from a lender or plan on approaching the Small Business Administration for a loan guarantee, a well thought out plan of action is essential for presenting the formalities of the proposed venture. In today’s highly competitive marketplace, a formal operating plan may mean the difference between success and failure.

What is a Business Plan?

Simply put, a Business Plan is a written statement outlining how you intend to operate your enterprise into the future. While most new business owners have a general idea of how they want to run their company, those intentions are usually not formalized. As the business grows and new challenges emerge, the owner often needs to involve others in the venture. This is a time when the owner finds himself/herself under pressure to formulate a plan for future growth. Unfortunately this time period affords the least amount of time for planning.

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Traditional business plans are critical to off-line businesses

Just because you are starting a business or have a business doesn’t mean you need a traditional business plan. The nature of your business and how you intend to use the plan determines whether you need a business a plan or not and the type of plan that is right for you.

Traditional business plans are critical to off-line businesses…

Off-line businesses usually require large amounts of cash. These cash requirements, if left unchecked, can drain or kill an off-line business before it even has the chance to gain traction. Traditional business plans are also easier to compile for off-line businesses because, unlike on-line businesses, off-line businesses tend to operate in more predictable business environments, which provide a basis on which to build projections.

To raise capital and manage the cash needed to run off-line businesses, owners often rely on elaborate business plans. More important, the people providing the cash to run off-line businesses use these plans to see how off-line businesses are going to use the cash and as a way to track its actual usage. That’s why traditional business plans include very detailed financial plans.

But, the Net’s environment is much different

Like most small business people’s lives, the Web changes very fast. This makes it difficult to project the future of an Internet based business.

Fortunately, the typical Internet business does not require large amounts of cash to maintain or operate. In fact, today, some service providers go beyond just providing you with disk space to park a Web site to providing you with all the tools to build a complete Web Business for just under $25 a month…something off-line businesses can only dream about.

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A commonly accepted theory is that for a business

When someone mentions business planning we have been conditioned to think about writing a business plan. There are hundreds of books and articles, tons of software, an army of consultants, and a multitude government programs to help you write a business plan. There are virtually no resources to help you set up what today’s business environment really demands – a continuous, ongoing planning system.

A commonly accepted theory is that for a business to survive and prosper it must be flexible and nimble. It must be able to turn on a dime as conditions warrant. Having a written five-year plan is not part of this picture. In fact, trying to follow a long-term plan during rampant change is not logical. It is applying linear thinking to a non-linear situation. It just doesn’t work.

Having a formal, written business plan is so accepted as being crucial to success that there haven’t been many studies or surveys to test this premise. If business plans were such a wonderful thing, there would be a significant and conclusive difference between businesses that have them and those that don’t. Interviews of 100 founders of companies on 1989s “INC 500″ list of fastest growing private companies in the U.S. found only 28 percent had “full-blown” business plans. The 1993 AT&T Small Business Study found that 59 percent of small businesses that grew over the previous two years used a formal business plan. A 1994 survey of the country’s fastest growing companies found 23 percent lacked a business plan. “The Relationship between Written Business Plans and the Failure of Small Businesses in the U.S.,” by Dr. Stephen Perry, surveyed 152 failed and 152 non-failed small businesses in 1997. He found that 64 percent of the non-failed firms had no written business plan. He also found that non-failed firms had more extensive written plans than failed firms, 23 percent compared to 9 percent, respectively.

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