Monday, September 11, 2006

So you still don't think you need a business plan huh?

New and inexperienced entrepreneurs I work with are forever coming up with mostly lame excuses for not having a business plan. When it comes to starting a business, the old saying really does apply with amazing consistency: 'failing to plan is planning to fail'.

Here are some of the most common excuses - and a bit of reality to boot.

Lame Excuse 1: I don't need a business plan--it's just me!
Reality: Successful Solo Entrepreneurs know that the exercise of creating a business plan, really helps them think through all the critical aspects of running a business, make better business decisions, and get to profitability sooner.

Lame Excuse 2: I have to buy business plan software before I can start.
Reality: Business plan software can be helpful—but it’s not required. Software is more likely to help if you have a more traditional type business, like a restaurant or a typical consulting business.

Lame Excuse 3: I need to hire a consultant to write my business plan.
Reality: Your business IS you—and you need to be intimately involved with the creation of your business plan. A better strategy, if you think you need professional help, is to hire a coach or mentor—someone who can guide you in what you need to do, not do it for you.

Lame Excuse 4: The business plan templates I’ve seen have all these complex-sounding sections to them—I guess I need all those?
Solo Entrepreneur Reality: Your business plan needs to answer ten basic questions—that’s it! Don’t make things more complicated than necessary.
Lame Excuse 5: My business plan needs to be perfect before I can start my business.

Reality: If you have at least a first draft that answers those ten basic questions, you are ready to launch your business! Make your business plan a living, evolving document. In the startup stages, review and update your plan every 2-3 months. As you grow and stabilize, you can slow down the review cycle to every 6-12 months. All business plans should be reviewed and updated at least once a year.

Lame Excuse 6: I have to do everything I say I’m going to do in my business plan, or I’m a failure.
Reality: Think of your business plan as a road map for a trip. Expect to take some detours for road construction. Be flexible enough to take some exciting, unplanned side trips. And don’t be surprised if instead of visiting Mount Rushmore, you decide to go to Yellowstone, if that turns out to meet your vacation goals better!

Lame Excuse 7: A good business plan has a nice cover, is at least 40 pages long, must be typed and double-spaced…
Reality: As a Solo Entrepreneur, your business plan need only satisfy YOU. It might be scribbled on a napkin, on stickie notes on your wall, or consist of a collage of pictures and captions. It might be all in one document or scattered among several mediums. As long as you know it in your head and heart without having to look at it, and and it is easily accessible to you when you have doubts, that’s all that is necessary.

Lame Excuse 8: I don’t need a loan—so I don’t need a business plan.
Seeing your plan in black and white (or color, if you prefer!), can give a whole new view on the financial viability of your business. If “doing the numbers” seems overwhelming, remember you don’t need fancy spreadsheets. Just lay out a budget that shows where all the money is coming from (and going), and have an accountant review it for additional perspective.

Lame Excuse 9: My business plan is in my head—that’s good enough.
Reality: There is a real power in writing down your plans. Some schools of thought advocate that the act of writing a plan down triggers our subconscious to start working on how to manifest that plan. And, of course, it’s a lot easier to remember when you have it in front of you. And a lot easier to share and get feedback from your non-mind reading supporters.

Lame Excuse 10: Friends and family are the best sources of feedback and advice on my business plan.
Reality: As well meaning as our friends and family can often be, they just aren’t the best way to get honest, objective guidance. Instead, seek out folks that have specific knowledge that will help you, are willing to be candid with you, and that have a genuine interest in helping you succeed. A business coach is one resource to consider!


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