And what’s a business plan good for?
When you started in business, how did you go about it? Did you take out every book from the library on entrepreneurship, on starting your own business and on business planning (because you thought you couldn’t afford to buy them), read every online article even remotely related to your field, interview every potential buyer who’d stand still long enough for you to pin them down, and then sit down and write a massive business plan of the kind all the books told you you’d need, with chapters and an index and gorgeous charts and projections up the wazoo?
I did, but I think I’m alone.
(One hesitates to add that way back when I went into business for myself for the second time, I probably could have read “every relevant online article” in a half an hour. If you’re starting your own business right now, it’ll take you just a touch longer than that. I am not even going to discuss the fact that the Internet did not exist when I first went into business for myself, thankyouverymuch.)
I’m working with a client right now who helps small business owners with their plans. Not the fabulous documents you could take to a bank in triplicate if only any bank would listen (and you may trust me on this, with very few exceptions they won’t), but their real, nitty-gritty, “how to move this business forward” kind of plans.
We’ve talked about her direction, because even a business planner needs a plan for getting the right words out to the right people at the right moment, and the most important element, which is her focus—specifically, who the heck plans well at the start?
If the answer really is, “only Kelly Erickson is such a plan-loving geek at the start,” then you guessed it, my job is to help her create Pinpoint focus on an Ideal Customer who is not a startup. Because I’m long done starting up. After a year or two, many business owners find themselves at a crossroads where they are ready to do the heavy lifting of creating a plan for the business they began by the seat of their pants. There may be a much more ready market in those folks, and if it’s what’s right for her, we’re going to aim her Solution directly at the needs of that Ideal Customer.
As is so often the case here at the Maximum Customer Experience Blog, that is not the point of this post.
I want you to know that I think everyone should geek-out on the books, blogs, and various other helps there are and create more stunning three-ring-bound dust-collectors like mine, right from the start. The process of planning, the maths for projections, the minute decisions and the big-picture dreaming that are required to put a formal business plan together are a trial-by-fire that could put good businesses on solid footing faster and give folks who are about to start a money pit a much-needed moment to pause.
No, I’m not joking. Though it may not be read by anyone but the mentors the books told you to round up and your Dad, who’ll shrug and say “sounds good,” you should do it. What a formal business plan will do for you, and for your business, is shake the sillies out and make you defend your ideas in print. If you can’t do it on a piece of paper, chances are you’re going to have a hard time doing it in front of a real live b-b-b-buyer. Important reality check. Cheaper than going belly-up, and quicker, too.
Next best is that nitty-gritty plan. Actually, in a perfect world I’d love to see folks do both. Two books that I often recommend are Getting Business to Come to You, and Get Clients Now! (amazon affiliate links) —both of which are superb places to start your focus and your nitty-gritty planning.
If you thought you’d figured me out, I must apologize. That is also not the point of this post.
Who plans well at the start? Not too many folks. I’d like to see it happen a lot more often. I’m hired by many clients who’ve been in business for a few years and they’re really in a jam. Things are not going the way they planned…
Oops. But they didn’t plan.
They took aim at a need and hoped there was a client to go with that need.
That, dear reader, is not putting the cart before the horse—it’s putting the horse’s ass before the cart. Just the ass.
You think you can’t afford a few books? Oh, the dollars you’ll throw away! The years and the hair-pulling and the sobbing that you’re in for! They could be avoided so easily with the research, the refining, and the clear writing you need for a good plan.
Okay, maybe not “easily.” But “profitably,” for sure.
What’s a business plan for?
Ah, the point of this post.
- You will never again read your business plan. Except for nostalgic purposes.
- No bank will give a tinker’s dam about the thing. And this may surprise you—banks are not ever nostalgic.
- It doesn’t matter that you read and followed the advice to cut your naïve financials by 2/3. You still will not meet any of the revenue goals. You will hit none of your staff projections.
- One day you will cringe at how you introduced yourself and your team as the next conquerors of the world. Yes, cringe.
- Everything else in the plan will make you laugh on that very same day.
What’s a business plan for? To force you to focus every ounce of your being on getting everything insanely right so you can walk into the most critical of domains, The Bank (da-da-da-duuuummm), confident, cocky, and ready to defend your plan to the unbelievers.
In all likelihood, you won’t ever get to. Banks stink like that. But you’ll thank me every day for making you do it.
Because after that, confidently explaining to the Ideal Customer how awesomely you’ll solve his or her problem is A WALK IN THE PARK.
What was the biggest lesson you learned from choosing to write—or not to write—a plan for your business? Would you recommend a plan to other startups, or am I full of bananas?
C’mon. You’re dying to answer that one.
Grow and be well,