5 Tips to Create a Business Plan for Longevity & Get Funding Too!
According to a 2015 Bloomberg¬ Business survey, as many as 8 out of 10 new businesses fail after their first year. You want to be one of the 20% that succeed – so where does a business plan come in?
Ali Sammour, founder of ICE Technologies, whose intuitive mobile shopping wallet KIKR is in beta testing, says "We had a strong pitch deck and great products. Our business plan helped us define our value proposition and we can use it as a flexible tool going forward for many different purposes."
Even if you are not as far along as ICE Technologies, your business plan will guide you through the planning steps necessary for the ingredients in the "secret sauce" of business success. Completing these tasks successfully makes business plans much more valuable than just stacks of paper that you show to bank lending officers, government grant reviewers, or business accelerator programs in order to get money.
Here are five specific benefits of a good business plan for every successful business start-up or expansion:
Benefit 1: Marketing Plan – know your market customer. Many start-up and accelerator programs will ask you to fill out market validation surveys. These are tools that help you discover key facts about your products, services and customers, but there is a big difference between a survey and an action plan to get results. Once you know how your products and services deliver value to your market customers, you can establish a marketing plan to reach them, sell, and move forward.
Benefit 2: Financial Projections – Some business owners are very strong with financial projections. They know every penny that comes in and that gets spent. They are able to project growth realistically, and know the pitfalls of growing too fast as well as too slowly. What if you're not one of them? Working with your financial projections, especially your cash flow for each month of your first year of new or expanded operations, can give you the accurate picture you need to set realistic targets for sales and expenses.
Benefit 3: Management Biographies – People give money to people, whether they are government grants administrators and reviewers, start-up accelerator programs, business grant programs or bank lenders. Many new entrepreneurs are modest and do not want to "toot their own horn." They will write as little as possible in their biographies, and reviewers don't get the chance to get to know them. A well-written management biography not only helps to introduce you to the people who will partner with you in your business success, it can give you a confidence boost as well.
Benefit 4: Let Your Products and Services Shine – Many new business owners have great ideas for great products and services, but they don't devote the time to define their unique value proposition. The value proposition is the reason that a customer would buy your product or pay for your service over any other competitor. An excellent products and services section will show your products and services and illustrate how they will deliver value to customers. Good pictures and descriptions can also be the basis for your business website and printed sales materials.
Benefit 5: Competitor Analysis – Here's where you get to say how much better you are than the other guys! Bzzt! Instead of putting the other guy down, competitor analysis is a fantastic way to further define your value proposition to customers. You can study your competitors to see the areas they excel in, their pricing strategies, and their market. Competitor analysis could be the strongest ingredient in your business plan "secret sauce" for success. A thorough competitor analysis will let you and funders know where you fit in the market picture, which customers you will serve, and how you will be a success.