Business Planning

• There are some basics to creating a business plan
• It is not possible to overstate the importance of a business planning
• There are business planning resources available to you in your community

What this means for the Older Worker

• Any good business has a good business plan. It is necessary to forecast the progress of your business. Many people believe that a business plan is simply "red tape" and is not required to get started.
• Banks and other lenders usually require a business plan
• A business plan will help you set goals for your business

Making the decision to start a business is a big one. It's important that you have all your bases covered and research all aspects of the business. By identifying your customers, your competition, creating a sound marketing plan and truly understanding your financial forecasts, your business will be much more viable.

In some cases, Older Workers will turn a hobby or interest into a business. They may not feel as though it is necessary to prepare a business plan. Although it is tempting to jump right into business without creating a plan, there are numerous reasons to create a well thought-out plan.

Business experts say that the most crucial step in starting a business is the planning stage. Unfortunately, this step often receives little or no attention. This can lead to disastrous outcomes such as the failure of the business, loss of an investment, or loss of personal assets.

A business plan allocates resources and measures the results of your actions, helping you set realistic goals and make logical decisions.

Reasons to Prepare a Business Plan

• It outlines the plans you have for your business.
• It gives you a path to follow. A plan with goals and action steps allows you to guide your business through turbulent often unforeseen economic conditions.
• A plan shows your banker the condition and direction of your business.
• It can help uncover any potential weaknesses and identify overlooked opportunities.
• It can help you anticipate and adapt to change.
• A plan can tell your sales personnel, suppliers, and others about your operations and goals.
• A plan can help you develop as a manager. It can give you practice in thinking and figuring out problems about competitive conditions, promotional opportunities and situations that are good or bad for your business.
• It can help you understand your competition.
• A sound plan tells you what to do and how to do it to achieve the goals you have set for your business.
• It helps to test your commitment to the idea by having you commit the business to writing.

Although all plans initially look a bit different, they will generally contain the same or similar information. All will require sections that outline things like Competition, Customer Analysis and Positioning Strategy, and most definitely they will all require a good financial section.

Format of a Business Plan

Most business plans require the same information. The business plan format you use may depend on whether or not you are looking for funding. A typical plan contains the following sections:

Cover Page

• Business name, address, business owner, phone number, date prepared

Executive Summary

• Include: Nature of the business, General location, Financing required, Market Share you plan to attain, other important information.
• Should be completed last, but then moved to the front of the plan.

Introduction

• Owner's background and experience.
• Summary of the business idea
• Reasons why the owner thinks that their business idea would be a good match. Include any management experience, or previous work experience that would make an impact. It would be a good idea to provide a résumé.

Mission Statement

• Defines your business's purpose. It directly states your main goals of "why" you are open. This is generally only a sentence or two in length.

Business Structure

• Sole Proprietorship - owned by one person, the simplest form of organization. The business does not have a separate legal status.
• Partnership - when two or more persons joining together to start a business. The business does not have a separate legal status.
• Corporation - It is a separate legal entity which means it has to file its own tax return. Any losses are of the company and not the individual.
• You must also include the reasons for choosing your business structure.

Objectives

• Identify goals for your business (1yr, 2-5yrs, 5+yrs)
• Use quantitative measures such as number of employees, expected sales and income, or number of customers per day, month or year.

Trends

• Report any trends that may influence your business. Things that you have noticed, read or have heard about in your community and the world.

Competition

• Research your competition and compare your business idea to them.
• Understand who are your direct and indirect competitors
• Do a S.W.O.T. Analysis (Strengths Weaknesses, Opportunities, Threats)

Customer Analysis

• Define your target market is (who will buy your product / Service)
• Include demographic information (age, income, gender, etc.)

Positioning Strategy

• Product - detailed description of product or service
• Price - how much you will charge and why
• Place - where will you be located? How will customers buy from you?
• Promotion - list places you will advertise. Include prices

Operation Plan

• This should include physical location, equipment, furniture, suppliers.
• A very detailed description of your business

Management

• Who are the key people in the business?
• What role will you play?
• What role will others play (if you have others)?

Financial Plan

• Project start-up costs
• Projected cash flow budgets supported by assumptions that support the projection
• Break-even analysis
• Projected income statement and balance sheet

There are numerous organizations in the community that can help you with your business planning. While some places only provide pieces to the puzzle, other organizations may be able to help with business planning from start to finish.

Things to think about

• A business plan is your map. You can use this map to see where you are and if you are on track.
• A well developed business plan is the cornerstone of any successful enterprise.
• No business is too small for a business plan.

Things to do

• Check the yellow pages in the phone book for any Business Development Centres for help with the business plan process
• Check with banks for business services
• Look for ACOA agencies in the area, Regional Development Agencies (RDAs) and Access Nova Scotia. There may be other helpful resources unique to your community.

Additional Information

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