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Monthly Archives: February 2017

5 Business Plan to Start Your Business

1: Business/Executive Summary

The executive summary needs to succinctly answer a number of key questions for prospective stake-holders, including investors, employees, vendors and customers. Often, an entrepreneur must summarize his/her new venture in a 250- to 500-word written summary or a three- to five-minute verbal description, said Jon Burgstone, founding faculty chair and adjunct professor at the Center for Entrepreneurship & Technology at the University of California, Berkeley. He is also the co-author of “Breakthrough Entrepreneurship” (Farallon Publishing, March 2012).

“The executive summary should be able to describe how the business will solve a customer pain [problem] in one or two sentences,” he said.

The business summary should also provide information on the management team, including experience, industry credibility, history working together and commitment to the venture.

“Include a specific plan to fill any gaps in your management team,” Burgstone said.

It is also necessary to include the business’s immediate objectives and resources required—including necessary capital milestones expected to be reached, and other information needed to understand the business and technical risk of the venture.

2: General Company Description

Raj Tumber, SCORE business counselor in the area of public relations, said this portion of the business plan should tell the story of your business, how it came to be, where it is today and where do you see it heading.

The company description should cover how you plan to grow and succeed and give investors and other interested parties a sense of your vision, knowledge and experience. Company history, current business position, objectives and ownership should also be included, he said.

3: Products and Services

This section is designed to simply explain to the potential party of interest about your products and services, said SCORE’s Tumber.

“[This section] explain[s] where you will source your supplies and inventory, specifies product comparison with those that are out in the market and explains your research and development plans,” he said.

In the introduction portion of this section, outline the most exciting characteristic or benefit of your product line or service, he said. “How can it attract the target market? Summarize the value and offerings your product delivers,” he said.

Other important things to touch upon are features, benefits and pricing of your products or services. These are key areas where many entrepreneurs skimp on the details, but they are arguably among the most important element of the business plan.

“This is where you have to really spell out how you are going to make money,” said Mike Mirau, owner of a Growth Coach franchise in Dallas. The franchise provides business and sales coaching. “You need to establish your margins, how you will set your pricing and what you offer relative to the competition,” he said.

4: Marketing

A marketing section should be broken into internal and external communication, including a subsection that touches on traditional (print and TV ads) as well as new tactics (social media, blogging, photo and video sharing, etc.)

“A media relations section would delve further into positioning staff and company executives as experts in particular fields, pitching story opportunities, setting up interviews, product reviews, use of bloggers, etc.,” said Jeremiah P. Sullivan, co-owner /integrated communication specialist for Framework Media Strategies, a marketing and public relations firm.

Potential investors also want to hear about how you plan to use mobile marketing to get the word out about your business.

“The number of mobile devices connected to the Internet is very quickly going to exceed PCs,” said Simon Buckingham, CEO ofAppitalism. “Mobile devices carry a much more personal brand and attachment to a consumer than a PC.”

5: Financials

“When you get to the financial part of the business plan, that is what many people fear the most,” said Tim Perry, founder and chairman ofPalo Alto Software, a provider of small-business software.

Cash flow is the most important aspect to focus on, he said. “The balance sheet is the holy grail. Businesses run on cash. No business plan is complete without a cash flow plan.”

Aside from cash and income, there is the balance of assets, liabilities and capital.

The plan should also cover profit and loss, incorporating sales, cost of sales, operating expenses and profits. In most cases it should show sales, less cost of sales, as gross margin, and gross margin less operating expenses as profit before interest and taxes. Normally there is also a projection of interest, taxes, and net profits, he said.

There should be a monthly sales forecast for the first 12 months and annual sales projections for the first three years of operation.

The Skinny Business Plan

It may be time to put your business plan on a diet. Experts say the document doesn’t need to go on for dozens and dozens of pages, include endless descriptions of your products or contain excruciatingly detailed financial projections. Instead, your business plan needs to just get to the point.

Of course, if you are trying to attract investors, you will need to furnish more details; but if the goal of your business plan is to keep you, your partners and employees on track and prepare for the future, you can trim it down to the basics.

“There are business plans for external use, but there should also be an internal business plan that is a living, breathing document that changes with your business, ” said Steven Raz, co-founder and managing partner ofCornerstone Search Group, an executive search firm specializing in pharmaceutical and biotechnology. “It can be 10 pages or less and should really be a selling document that grabs you.”

For starters, you need an executive summary that quickly provides a hook, said Christian Seale, chief operating officer of Equitable Origin, which has created a responsible certification program designed to promote higher social and environmental standards, greater transparency, and more accountability in oil and gas exploration and production.

“You should summarize the problem or opportunity and address how your company’s product or services will address a need,” he said. “You also want to briefly summarize the team that is in place and the skills they have to make it happen.”

The condensed business plan needs to include a description of the product and a description of potential consumers, experts said. “This should be backed up by a brief analysis of who current competitors and potential competitors will be, explaining how the product differs from other offerings,” said Mark Cracknell, co-founder and executive director of Kondoot.com, a social network that lets members broadcast live to family and friends for free.

While you need to make the case for your product or services, too many business plans get bogged down with pages of market research, experts said. “While this may be necessary as you look for investors, keep that to a minimum to make the business plan manageable,” Seale said.

While you can still include financials, don’t overload the plan with data and projects and present relevant information in bright, colorful chart formats. “In this document you are not reaching exclusively financial people and potential investors, so make the information accessible,” said Raz.

In a more brief business plan, exceedingly detailed analysis of expenses can be left out. “Depending on the product and industry, it can be very difficult to gauge exact expenses when dealing with unknown growth factors,” Cracknell said. “If the figures or amounts cannot be determined with a reasonable amount of accuracy, then it’s best to leave them out.”

Cracknell added that there should also be a brief history about who started the company and its origins, he said. “You need to communicate how the business came about and the view going forward,” he said.

Sales and marketing strategy are also important elements of the slimmed-down business plan. “This is always fluid, but putting it in writing as things change help you to remain focused,” said Beth Goldstein, president ofMarketing Edge Consulting Group and directorof the $50K New Venture Competition at Boston University.

The best business plan is a finite and defined outline of key acts by specific dates, said

Nicholas L. Turner, co-chief executive officer for Kaye/Bassman International Corp., which provides strategic recruiting and executive search services.

He said developing a formal business plan goes against the grain of many entrepreneurs. “If you put too much detail, you will never get it done, you will never adhere to the map and you will feel restricted from a dynamic capacity to be the entrepreneur,” he said. “I say adapt the plan to you, not you to the plan. A business plan is a tool to use, not the objective to accomplish.”

7 Things to Do Before Opening a Salon

For many beauty-industry professionals, owning a salon is a dream come true. If you’ve got the styling skills and the capital needed to start your business, you’re already halfway there. However, just like with any other industry, opening your own business can be challenging, and it comes with a lot of tasks and responsibilities to complete.

Thinking about putting your beauty skills to the test and opening your own salon? Make sure you follow these 10 expert tips first.

“A business plan is key to starting a salon. The plan offers a road map for salon owners to follow and helps entrepreneurs consider all areas of the business. A business plan makes sure you set up a metric for success and consider the financials before you invest huge amounts of time and money in a new salon.”

“With salons on every corner, even in small towns, entering into the market with a specialty or service niche can dramatically increase buzz and press about your opening. Most salons try to please everyone, offering a huge menu of services. But this does nothing to differentiate you in the market. Even if you do offer many services, promoting a niche or specialty service will help you attract not only a very loyal client base, but will [also] instantly lend credibility to your salon as the experts in your niche space.”

“Do your research. Ensure that you are complying with the state laws and regulations. If you have to make some adjustments to your plan because of regulations and laws, do so early so that you can avoid potentially having to stop your operation later or [having to pay] a fine. This will save you time and money.”

“Get in touch with major product distributors like Redken, Paul Mitchell, etc. Some of them offer support services such as training [and] consultants to salon owners and staff. “

“My number-one tip for aspiring entrepreneurs before they open up a salon is to have a number of professional clients of your own that will cover your overhead. Salon employees have an independent mind-set and will try to make power plays. With a solid client base of your own, you’ll be in a better position to call the shots.”

“Secure a solid location with plenty of parking. If you make it convenient for clients to visit your salon, you’ll have more customers, which in turn means more revenue to pay off your initial loan and to put toward growth expenses.”

“I would advise any new salons to invest time in the training and motivation of the staff. Now, any technician is going to know their trade. However, they might need help with the selling and customer-retention side. Your salon will be built around your stylists and technicians, [so] ensuring they are comfortable with up-selling products and other treatments across the brand is the difference between success and failure. Spending time before launch training your key staff to learn these key skills and learn how to teach them to new employees will pay dividends once the salon is running, and will go a long way to help with the smooth operation of a successful business.”

7 Free Business Plan Templates

Business plans can seem daunting to someone who has never written one. The business idea itself might be fairly simple to explain, but if you want to apply for a loan, raise investor capital, or simply have a solid, documented direction for your company, you’re going to need to write a business plan.

Luckily for entrepreneurs, there are templates out there that allow you to plug in all of the information, instead of struggling with formatting and figuring out what you need to include. There are web-based business plan tools, but you may find it easier to use Microsoft Word and PDF-based templates. Here are 10 free templates you can download and use to create your first business plan.

Bplans.com, known as the authority on business plans, offers a free Word business plan template, complete with instructions and a table of contents. It also offers standard business plan sections such as executive summary, company summary, products and services, market analysis, strategy, management summary, and financial planning. Once you register, you will be able to download the materials and choose from a wide range of businesses in different industries in which to base your plan. Whether your business is online, service-based, or a food establishment, Bplan’s Word business plan templates are comprehensive and are a great option for beginners and new business owners.

Entrepreneur.com provides business tools, with a collection of business plansfree in PDF, PowerPoint and Word. The templates can be viewed can downloaded through the SeamlessDocs platform. The site includes a template for a variety of specific business types, a business plan model that outlines the different parts of a business plan, and customizable templates that allow users to add their logos and business information. If you need a guide to writing a business plan, Entrepreneur.com also provides a download for that.

This step-by-step business plan builder, offered by Law Depot, covers structure, product marketing, SWOT (strengths, weaknesses, opportunities, threats), operations, and details specific to your business in their templates. Once the template is complete, you can download and print. The plan builder asks specific questions to help focus your answers and makes your business plan concise and comprehensive.

MOBI, or My Own Business Institute, is part of Santa Clara University’s Center for Innovation and Entrepreneurship. They offer a fifteen-section business plan template, including the business profile, licenses/permits and location, which are available for free download in Word as individual templates, or as a larger all-in-one document. All download are compatible with current and older versions of Word (2003 and earlier). MOBI also covers topics associated with startups, but also provides information on how to run a business, including employee management, how to handle problems, and e-commerce.

Office Depot’s Business Resource Center contains free business plan samplesfor retailers, manufacturers and service providers. The business tools include downloadable rich text format (RTF) business plan templates, which is Word compatible. Excel business plan financials are also available for manufacturers and service providers, while the retailer business plan template is complete with forecasting and financial tables, but this requires Microsoft Word version 6.0 or later.

Catering to businesses owned by women, Oprah.com’s free one-page business plan templates can be used by anyone who wants to start a business. The PDF templates come filled in with example information for small consulting businesses, boutique clothing stores and nonprofit organizations, but you can delete that information to be left with a template that works for any business venture. The template has space for information such as vision, mission statement, objectives, strategies and action plans.

When you create a free business plan with Rocket Lawyer, you get the advantage of an attorney’s advice to make sure your document is legally sound. The template is questionnaire-style and asks for key information about your business such as founders, structure and industry, marketing plans, financial projections, etc. Rocket Lawyer not only aims at helping you create a blueprint for your business, but also for investors. Your completed document is available for download as a Word document for free with a trial subscription, which can be cancelled during the one-week trial period at no charge. The document is $10 on its own without a subscription.