By Scott Sargis
Published In The Chicago Tribune
October 31, 2001
Despite the economic downturn, many new business opportunities still exist. Areas such as security, rescue, intelligence gathering and health care beg for new solutions. The key is to identify a market need and develop a product or service addressing that need.
The most important first step is to prepare a business plan. It provides direction and helps articulate your dream to others critical to your success. There is no one correct way to prepare it, but you must clearly articulate your ideas and your plan to achieve them.
A business plan will help you avoid the biggest mistake would be entrepreneurs make: Developing products first, then looking for a market. It’s got to work the other way around: Identify a market need and develop solutions to meet that need.
Many entrepreneurs never get to first base because they never have committed to paper their dreams and plan of action to achieve their goals. And many who have a plan often have paid others to write it.
A business plan is a tool to help raise money and provides a road map for the launch of the business. If you cannot put down on paper what you are trying to accomplish, why that makes good business sense and what problems you are likely to encounter, then you cannot make the business itself work.
Moreover, many new businesses fail because they provide a 50-cent solution to a 5-cent problem. The business plan will help uncover unprofitable ideas before you invest a lot of hard-earned time and expense.
Many guides exist, including books, seminars and software products; but there is no one right way to write a business plan.
Essentials of a good business plan include an executive summary, company details (short and long term plans); marketing plan, product/service. details, sales plan, financial projections, and supporting documentation (e.g. management team biographies). One of the easiest to follow books I have found is “Business Plans That Win $$$” (Harper and Row $13), by Stanley Rich and David Grumpert.
Most potential investors will start by spending 30 seconds or less glancing over the executive summary to see if you have a compelling business model. If not they will not read further.
Hiring someone to write the business plan creates problems. You must be able to answer all investors’ questions and you will not be competent to answer if you have not written the plan yourself.
Have experts such as your accountant or lawyer review it and make comments. Write and rewrite it until you have a masterpiece.