Tip of the Week: 10 business planning strategies
April 12, 2011 at 5:03 p.m.
Updated April 11, 2011 at 11:12 p.m.
For business plans and models, one thing is certain: What you conceive will not be exactly what comes to pass.
If you are looking for financing or investors and are putting together a formal business plan, there are some common errors you should avoid.
The following list of 10 things to do in the planning stage should help you get the numbers, concepts and action steps down as closely as possible.
1: Conduct industrial espionage.
Research and understand the competition. Your company should be able to show you are dramatically different in some way, and that means you have to know what is happening on the other side of the fence.
2: Get out of the office.
Talk to potential customers. Know what they are using now to fill their need and, if you can, test your product or service concept by obtaining a customer today. Your discussion with customers should help you focus on those with a need you can fulfill.
Your business should determine those customers who will yield the best return. You then will be able to focus and refine your business model based on solid field evidence.
3: Develop a repeat strategy.
You want to create repeat customers or a solid referral base - if you want to grow a business, recurring income should happen nearly automatically.
4: Tell a good story.
No matter if your audience is a team member, your customers or investors, sharing your passion and vision is important. Work at it.
5: Find a devil's advocate.
Get someone you trust who will tell you where the gaps are in your plan. They may be able to give you constructive criticism.
6: Make connections with relevant resource partners.
Don't try to go it alone. Know your strengths and reserve your energy for those things you do well. Hire or barter for the other stuff. Get a professional to review your numbers, for sure.
7: Prepare to pivot focus and direction.
If your plan is just not working, it is time to move on. Have a business model in place, but have Plan B ready to go if the need arises.
8: Treat money as the scarce resource it is.
Spend a nickel only if it will make you a dime.
9: Evaluate your total market with your eyes wide open.
If you want a small slice, know what the pie is made of. Be realistic about what is possible without being too pessimistic.
10: Set milestones.
Create an action plan with numbers and key goals laid out. Then go for it.
For help in putting these strategies into place or for assistance on your business plans and business models, contact the University of Houston-Victoria Small Business Development Center.
Eileen Bonner is a business advisor with the University of Houston-Victoria Small Business Development Center.