THE B-PLAN

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“FAILING TO PLAN IS PLANNING TO FAIL”

 

What is a business plan? What is the advantage of making one?

A business plan is merely a tool that helps to get an entrepreneur’s onto paper. It is a way that an entrepreneur has to show his knowledge of the market he is entering into, the numbers he thinks he can achieve and what how he imagines the final structure of his company to be. 543,000 new business start each month, according to Fobes.com, a business plan helps to make your plan look better, well at least on paper. At the very least, the process of putting a business plan together (not the type that you would do to get finance from a VC or an angel), but an honest attempt at what you expect to do – will make you think about some of the key aspects such as customers, products, location, demographics, and risk as well as an introspection on how well do you yourself know about your plan and the market you are entering in, giving one an opportunity to look at the plans shortcomings. A B-plan is like a diary entry for an entrepreneur with a difference that it has to change from time to time according to the needs of the market.

 

When to write the B-plan?

Many entrepreneurs think the b-plan to be merely an instrument to get funding, but that is not the case. You’ll use the plan for so much more-for managing yourself, for operating the business and for recruiting (yeah! I too got one before joining techaloo, that’s what makes this article so important).

The most important part about writing a business plan is that it forces one to think logically and spot errors and connections that one may miss without making it.

For example, if your marketing plan projects 10,000 customers by year two and your staffing plan provides for 2 salespeople, that forces you to ask: How can two salespeople generate 10,000 customers? A business plan forces you to study your numbers and helps you avoid making reckless or foolish decisions.

Your plan is a baseline for monitoring your progress. When you write about say for example we will be able to sell 1000 products in a month, it may be a prediction but writing it down also makes it your goal.

That brings to the answer that business plans have to be updated from time to time basis which should not be very short (IF that’s the case your business plan is assumed to be weak and unstable and a lack of research is cited ) and also should not be very long (nobody will care about them much in that case). So reviewing the business plan at every major milestone seems to be a logical conclusion.

 

How to make a b-plan?

1.Know your target audience for the plan.

2. Go for numbers, nobody pays attention to theory.

3. Know your out. Plan your exit strategy from the beginning.

4. Scalability.

 

More info in this article – http://techaloo.com/how-to-make-a-b-plan/

 

Some questions that your business plan should be able to explain –

 

  1. The initial amount required for your business?
  2. How many more people will you require in your company and their status in the company?
  3. How much control are you willing to relinquish to investors?
  4. When will the business turn a profit?
  5. How do you expect your profits to rise (by %age) once the company starts making profit?
  6. When can investors, including you, expect a return on their money?
  7. Will you be able to devote yourself full time to the business, financially?
  8. What kind of salary or profit distribution can you expect to take home?
  9. What are the chances the business will fail?
  10. 10. What will happen if it does?

 

The most important- Why invest in your team? (They will never talk about you as an individual but your team). Most VC’s and investors look at the team more so than the idea itself, the point is that they have a lot of similar ideas coming to them, so for them it’s more important for them to choose the right type of people they want to work with. Also because of the fact that it’s the execution of the idea and end results that matter and most great ideas fall because of rifts between the team or your team no longer believes in that idea or your team is not working as much as you expect them to.

 

Cheers and best of luck for your next b-plan.

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